0000354707false12/312022Q1000004620712/312022Q16.676.670000354707he:HawaiianElectricCompanyAndSubsidiariesMember2022-01-012022-03-3100003547072022-01-012022-03-3100003547072022-04-25xbrli:shares0000354707he:HawaiianElectricCompanyAndSubsidiariesMember2022-04-250000354707he:ElectricUtilitySegmentMember2022-01-012022-03-31iso4217:USD0000354707he:ElectricUtilitySegmentMember2021-01-012021-03-310000354707he:BankingSegmentMember2022-01-012022-03-310000354707he:BankingSegmentMember2021-01-012021-03-310000354707us-gaap:AllOtherSegmentsMember2022-01-012022-03-310000354707us-gaap:AllOtherSegmentsMember2021-01-012021-03-3100003547072021-01-012021-03-31iso4217:USDxbrli:shares00003547072022-03-3100003547072021-12-310000354707us-gaap:CommonStockMember2021-12-310000354707us-gaap:RetainedEarningsMember2021-12-310000354707us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-12-310000354707us-gaap:RetainedEarningsMember2022-01-012022-03-310000354707us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-01-012022-03-310000354707us-gaap:CommonStockMember2022-01-012022-03-310000354707us-gaap:CommonStockMember2022-03-310000354707us-gaap:RetainedEarningsMember2022-03-310000354707us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-03-310000354707us-gaap:CommonStockMember2020-12-310000354707us-gaap:RetainedEarningsMember2020-12-310000354707us-gaap:AccumulatedOtherComprehensiveIncomeMember2020-12-3100003547072020-12-310000354707us-gaap:RetainedEarningsMember2021-01-012021-03-310000354707us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-01-012021-03-310000354707us-gaap:CommonStockMember2021-01-012021-03-310000354707us-gaap:CommonStockMember2021-03-310000354707us-gaap:RetainedEarningsMember2021-03-310000354707us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-03-3100003547072021-03-310000354707he:HawaiianElectricCompanyAndSubsidiariesMember2021-01-012021-03-310000354707he:HawaiianElectricCompanyAndSubsidiariesMember2022-03-310000354707he:HawaiianElectricCompanyAndSubsidiariesMember2021-12-310000354707he:HawaiianElectricCompanyAndSubsidiariesMemberus-gaap:CommonStockMember2021-12-310000354707us-gaap:AdditionalPaidInCapitalMemberhe:HawaiianElectricCompanyAndSubsidiariesMember2021-12-310000354707us-gaap:RetainedEarningsMemberhe:HawaiianElectricCompanyAndSubsidiariesMember2021-12-310000354707us-gaap:AccumulatedOtherComprehensiveIncomeMemberhe:HawaiianElectricCompanyAndSubsidiariesMember2021-12-310000354707us-gaap:RetainedEarningsMemberhe:HawaiianElectricCompanyAndSubsidiariesMember2022-01-012022-03-310000354707us-gaap:AccumulatedOtherComprehensiveIncomeMemberhe:HawaiianElectricCompanyAndSubsidiariesMember2022-01-012022-03-310000354707he:HawaiianElectricCompanyAndSubsidiariesMemberus-gaap:CommonStockMember2022-03-310000354707us-gaap:AdditionalPaidInCapitalMemberhe:HawaiianElectricCompanyAndSubsidiariesMember2022-03-310000354707us-gaap:RetainedEarningsMemberhe:HawaiianElectricCompanyAndSubsidiariesMember2022-03-310000354707us-gaap:AccumulatedOtherComprehensiveIncomeMemberhe:HawaiianElectricCompanyAndSubsidiariesMember2022-03-310000354707he:HawaiianElectricCompanyAndSubsidiariesMemberus-gaap:CommonStockMember2020-12-310000354707us-gaap:AdditionalPaidInCapitalMemberhe:HawaiianElectricCompanyAndSubsidiariesMember2020-12-310000354707us-gaap:RetainedEarningsMemberhe:HawaiianElectricCompanyAndSubsidiariesMember2020-12-310000354707us-gaap:AccumulatedOtherComprehensiveIncomeMemberhe:HawaiianElectricCompanyAndSubsidiariesMember2020-12-310000354707he:HawaiianElectricCompanyAndSubsidiariesMember2020-12-310000354707us-gaap:RetainedEarningsMemberhe:HawaiianElectricCompanyAndSubsidiariesMember2021-01-012021-03-310000354707us-gaap:AccumulatedOtherComprehensiveIncomeMemberhe:HawaiianElectricCompanyAndSubsidiariesMember2021-01-012021-03-310000354707he:HawaiianElectricCompanyAndSubsidiariesMemberus-gaap:CommonStockMember2021-03-310000354707us-gaap:AdditionalPaidInCapitalMemberhe:HawaiianElectricCompanyAndSubsidiariesMember2021-03-310000354707us-gaap:RetainedEarningsMemberhe:HawaiianElectricCompanyAndSubsidiariesMember2021-03-310000354707us-gaap:AccumulatedOtherComprehensiveIncomeMemberhe:HawaiianElectricCompanyAndSubsidiariesMember2021-03-310000354707he:HawaiianElectricCompanyAndSubsidiariesMember2021-03-310000354707us-gaap:OperatingSegmentsMemberhe:ElectricUtilitySegmentMember2022-01-012022-03-310000354707us-gaap:OperatingSegmentsMemberhe:BankingSegmentMember2022-01-012022-03-310000354707us-gaap:OperatingSegmentsMemberus-gaap:AllOtherSegmentsMember2022-01-012022-03-310000354707us-gaap:OperatingSegmentsMember2022-01-012022-03-310000354707us-gaap:IntersegmentEliminationMemberhe:ElectricUtilitySegmentMember2022-01-012022-03-310000354707he:BankingSegmentMemberus-gaap:IntersegmentEliminationMember2022-01-012022-03-310000354707us-gaap:AllOtherSegmentsMemberus-gaap:IntersegmentEliminationMember2022-01-012022-03-310000354707us-gaap:IntersegmentEliminationMember2022-01-012022-03-310000354707he:ElectricUtilitySegmentMember2022-03-310000354707he:BankingSegmentMember2022-03-310000354707us-gaap:AllOtherSegmentsMember2022-03-310000354707us-gaap:OperatingSegmentsMemberhe:ElectricUtilitySegmentMember2021-01-012021-03-310000354707us-gaap:OperatingSegmentsMemberhe:BankingSegmentMember2021-01-012021-03-310000354707us-gaap:OperatingSegmentsMemberus-gaap:AllOtherSegmentsMember2021-01-012021-03-310000354707us-gaap:OperatingSegmentsMember2021-01-012021-03-310000354707us-gaap:IntersegmentEliminationMemberhe:ElectricUtilitySegmentMember2021-01-012021-03-310000354707he:BankingSegmentMemberus-gaap:IntersegmentEliminationMember2021-01-012021-03-310000354707us-gaap:AllOtherSegmentsMemberus-gaap:IntersegmentEliminationMember2021-01-012021-03-310000354707us-gaap:IntersegmentEliminationMember2021-01-012021-03-310000354707he:ElectricUtilitySegmentMember2021-12-310000354707he:BankingSegmentMember2021-12-310000354707us-gaap:AllOtherSegmentsMember2021-12-310000354707srt:SubsidiariesMember2022-01-012022-03-31he:agreement0000354707he:PunaGeothermalVenturePowerPurchaseAgreementMember2021-01-012021-03-31utr:MW0000354707he:PunaGeothermalVenturePowerPurchaseAgreementMember2021-04-012021-06-30he:entity0000354707he:HawaiianElectricParentMemberhe:KalaeloaPartnersLPMember2022-01-012022-03-310000354707he:HawaiianElectricParentMemberhe:KalaeloaPartnersLPMember2021-01-012021-03-310000354707he:HawaiianElectricParentMemberhe:AESHawaiianIncMember2022-01-012022-03-310000354707he:HawaiianElectricParentMemberhe:AESHawaiianIncMember2021-01-012021-03-310000354707he:HawaiianElectricParentMemberhe:HpowerMember2022-01-012022-03-310000354707he:HawaiianElectricParentMemberhe:HpowerMember2021-01-012021-03-310000354707he:HamakuaEnergyPartnersLPMemberhe:HawaiianElectricParentMember2022-01-012022-03-310000354707he:HamakuaEnergyPartnersLPMemberhe:HawaiianElectricParentMember2021-01-012021-03-310000354707he:PunaGeothermalVentureMemberhe:HawaiianElectricParentMember2022-01-012022-03-310000354707he:PunaGeothermalVentureMemberhe:HawaiianElectricParentMember2021-01-012021-03-310000354707he:HawaiianElectricParentMemberhe:WindIndependentPowerProducersMember2022-01-012022-03-310000354707he:HawaiianElectricParentMemberhe:WindIndependentPowerProducersMember2021-01-012021-03-310000354707he:HawaiianElectricParentMemberhe:SolarIndependentPowerProducerMember2022-01-012022-03-310000354707he:HawaiianElectricParentMemberhe:SolarIndependentPowerProducerMember2021-01-012021-03-310000354707he:OtherIndependentPowerProducersMemberhe:HawaiianElectricParentMember2022-01-012022-03-310000354707he:OtherIndependentPowerProducersMemberhe:HawaiianElectricParentMember2021-01-012021-03-310000354707he:HawaiianElectricParentMember2022-01-012022-03-310000354707he:HawaiianElectricParentMember2021-01-012021-03-310000354707he:HawaiianElectricParentMemberhe:KalaeloaPartnersLPMember1988-01-011988-12-310000354707he:KalaeloaPartnersLPMember2021-10-012021-10-310000354707he:KalaeloaPartnersLPMember2022-01-012022-03-31xbrli:pure0000354707he:AESHawaiianIncMember1988-03-011988-03-310000354707he:HuHonuaBioenergyLLCMember2012-05-012012-05-310000354707he:MolokaiNewEnergyPartnersMember2018-07-012018-07-310000354707he:SauseBrosIncMember2021-08-232021-08-230000354707he:SauseBrosIncMember2022-01-310000354707he:SauseBrosIncMember2022-01-012022-01-310000354707he:ERPEAMImplementationProjectMemberhe:HawaiianElectricCompanyAndSubsidiariesMember2022-01-012022-03-310000354707he:ERPEAMImplementationProjectMemberhe:HawaiianElectricCompanyAndSubsidiariesMember2018-10-310000354707he:ERPEAMImplementationProjectMember2019-06-100000354707he:ERPEAMImplementationProjectMember2019-06-102019-06-100000354707he:ERPEAMImplementationProjectMemberhe:HawaiianElectricCompanyAndSubsidiariesMember2022-03-310000354707he:ERPEAMImplementationProjectMemberhe:HawaiianElectricParentMember2022-03-310000354707he:ERPEAMImplementationProjectMemberhe:HawaiiElectricLightCompanyIncMember2022-03-310000354707he:MauiElectricCompanyLimitedMemberhe:ERPEAMImplementationProjectMember2022-03-310000354707he:MauiElectricCompanyLimitedMemberhe:ERPEAMImplementationProjectMember2022-01-012022-03-310000354707he:MauiElectricCompanyLimitedMember2022-03-310000354707he:PCBContaminationMemberhe:HawaiianElectricParentMember2022-03-310000354707he:HawaiianElectricCompanyAndSubsidiariesMember2020-12-232020-12-230000354707he:HawaiianElectricCompanyAndSubsidiariesMember2020-12-230000354707he:HawaiianElectricCompanyAndSubsidiariesMember2022-03-312022-03-310000354707he:SchofieldGenerationStationMemberhe:HawaiianElectricCompanyAndSubsidiariesMember2022-03-312022-03-310000354707he:WestLochPVProjectMemberhe:HawaiianElectricCompanyAndSubsidiariesMember2022-03-312022-03-310000354707he:GridModernizationStrategyPhase1ProjectMemberhe:HawaiianElectricCompanyAndSubsidiariesMember2022-03-312022-03-31he:contracthe:project00003547072020-12-232020-12-230000354707he:HawaiianElectricCompanyAndSubsidiariesMember2021-11-122021-11-120000354707he:HawaiianElectricCompanyAndSubsidiariesMember2022-02-280000354707he:HawaiianElectricCompanyAndSubsidiariesMember2019-01-012019-12-310000354707he:HawaiianElectricCompanyAndSubsidiariesMember2019-12-310000354707he:HawaiianElectricCompanyAndSubsidiariesMember2020-07-090000354707he:HawaiianElectricCompanyAndSubsidiariesMember2021-02-162021-02-160000354707he:HawaiianElectricCompanyAndSubsidiariesMember2021-09-012021-11-300000354707he:HawaiianElectricCompanyAndSubsidiariesMember2021-03-23he:mechanismutr:MWh0000354707he:HawaiianElectricCompanyAndSubsidiariesMember2021-01-012021-12-310000354707he:HawaiianElectricCompanyAndSubsidiariesMember2021-06-010000354707he:HawaiianElectricParentMember2021-12-310000354707he:HawaiiElectricLightCompanyIncMember2021-12-310000354707he:MauiElectricCompanyLimitedMember2021-12-310000354707he:HawaiiElectricLightCompanyIncMember2022-01-012022-03-310000354707he:MauiElectricCompanyLimitedMember2022-01-012022-03-310000354707he:HawaiianElectricCompanyAndSubsidiariesMemberhe:COVID19Member2021-12-012021-12-310000354707srt:ParentCompanyMembersrt:ReportableLegalEntitiesMemberhe:HawaiianElectricCompanyAndSubsidiariesMember2022-01-012022-03-310000354707srt:ReportableLegalEntitiesMemberhe:HawaiianElectricCompanyAndSubsidiariesMemberhe:HawaiiElectricLightCompanyIncMember2022-01-012022-03-310000354707srt:ReportableLegalEntitiesMemberhe:HawaiianElectricCompanyAndSubsidiariesMemberhe:MauiElectricCompanyLimitedMember2022-01-012022-03-310000354707srt:ReportableLegalEntitiesMemberhe:HawaiianElectricCompanyAndSubsidiariesMemberhe:OtherSubsidiariesMember2022-01-012022-03-310000354707srt:ConsolidationEliminationsMemberhe:HawaiianElectricCompanyAndSubsidiariesMember2022-01-012022-03-310000354707srt:ParentCompanyMembersrt:ReportableLegalEntitiesMemberhe:HawaiianElectricCompanyAndSubsidiariesMember2021-01-012021-03-310000354707srt:ReportableLegalEntitiesMemberhe:HawaiianElectricCompanyAndSubsidiariesMemberhe:HawaiiElectricLightCompanyIncMember2021-01-012021-03-310000354707srt:ReportableLegalEntitiesMemberhe:HawaiianElectricCompanyAndSubsidiariesMemberhe:MauiElectricCompanyLimitedMember2021-01-012021-03-310000354707srt:ReportableLegalEntitiesMemberhe:HawaiianElectricCompanyAndSubsidiariesMemberhe:OtherSubsidiariesMember2021-01-012021-03-310000354707srt:ConsolidationEliminationsMemberhe:HawaiianElectricCompanyAndSubsidiariesMember2021-01-012021-03-310000354707srt:ParentCompanyMembersrt:ReportableLegalEntitiesMemberhe:HawaiianElectricCompanyAndSubsidiariesMember2022-03-310000354707srt:ReportableLegalEntitiesMemberhe:HawaiianElectricCompanyAndSubsidiariesMemberhe:HawaiiElectricLightCompanyIncMember2022-03-310000354707srt:ReportableLegalEntitiesMemberhe:HawaiianElectricCompanyAndSubsidiariesMemberhe:MauiElectricCompanyLimitedMember2022-03-310000354707srt:ReportableLegalEntitiesMemberhe:HawaiianElectricCompanyAndSubsidiariesMemberhe:OtherSubsidiariesMember2022-03-310000354707srt:ConsolidationEliminationsMemberhe:HawaiianElectricCompanyAndSubsidiariesMember2022-03-310000354707srt:ParentCompanyMembersrt:ReportableLegalEntitiesMemberhe:HawaiianElectricCompanyAndSubsidiariesMember2021-12-310000354707srt:ReportableLegalEntitiesMemberhe:HawaiianElectricCompanyAndSubsidiariesMemberhe:HawaiiElectricLightCompanyIncMember2021-12-310000354707srt:ReportableLegalEntitiesMemberhe:HawaiianElectricCompanyAndSubsidiariesMemberhe:MauiElectricCompanyLimitedMember2021-12-310000354707srt:ReportableLegalEntitiesMemberhe:HawaiianElectricCompanyAndSubsidiariesMemberhe:OtherSubsidiariesMember2021-12-310000354707srt:ConsolidationEliminationsMemberhe:HawaiianElectricCompanyAndSubsidiariesMember2021-12-310000354707srt:ParentCompanyMembersrt:ReportableLegalEntitiesMemberhe:HawaiianElectricCompanyAndSubsidiariesMember2020-12-310000354707srt:ReportableLegalEntitiesMemberhe:HawaiianElectricCompanyAndSubsidiariesMemberhe:HawaiiElectricLightCompanyIncMember2020-12-310000354707srt:ReportableLegalEntitiesMemberhe:HawaiianElectricCompanyAndSubsidiariesMemberhe:MauiElectricCompanyLimitedMember2020-12-310000354707srt:ReportableLegalEntitiesMemberhe:HawaiianElectricCompanyAndSubsidiariesMemberhe:OtherSubsidiariesMember2020-12-310000354707srt:ConsolidationEliminationsMemberhe:HawaiianElectricCompanyAndSubsidiariesMember2020-12-310000354707srt:ParentCompanyMembersrt:ReportableLegalEntitiesMemberhe:HawaiianElectricCompanyAndSubsidiariesMember2021-03-310000354707srt:ReportableLegalEntitiesMemberhe:HawaiianElectricCompanyAndSubsidiariesMemberhe:HawaiiElectricLightCompanyIncMember2021-03-310000354707srt:ReportableLegalEntitiesMemberhe:HawaiianElectricCompanyAndSubsidiariesMemberhe:MauiElectricCompanyLimitedMember2021-03-310000354707srt:ReportableLegalEntitiesMemberhe:HawaiianElectricCompanyAndSubsidiariesMemberhe:OtherSubsidiariesMember2021-03-310000354707srt:ConsolidationEliminationsMemberhe:HawaiianElectricCompanyAndSubsidiariesMember2021-03-310000354707he:AmericanSavingsBankFSBMember2022-01-012022-03-310000354707he:AmericanSavingsBankFSBMember2021-01-012021-03-310000354707he:AmericanSavingsBankFSBMemberus-gaap:FinancialServiceMember2022-01-012022-03-310000354707he:AmericanSavingsBankFSBMemberus-gaap:FinancialServiceMember2021-01-012021-03-310000354707us-gaap:DepositAccountMemberhe:AmericanSavingsBankFSBMember2022-01-012022-03-310000354707us-gaap:DepositAccountMemberhe:AmericanSavingsBankFSBMember2021-01-012021-03-310000354707us-gaap:FinancialServiceOtherMemberhe:AmericanSavingsBankFSBMember2022-01-012022-03-310000354707us-gaap:FinancialServiceOtherMemberhe:AmericanSavingsBankFSBMember2021-01-012021-03-310000354707he:BankOwnedLifeInsuranceIncomeMemberhe:AmericanSavingsBankFSBMember2022-01-012022-03-310000354707he:BankOwnedLifeInsuranceIncomeMemberhe:AmericanSavingsBankFSBMember2021-01-012021-03-310000354707us-gaap:MortgageBankingMemberhe:AmericanSavingsBankFSBMember2022-01-012022-03-310000354707us-gaap:MortgageBankingMemberhe:AmericanSavingsBankFSBMember2021-01-012021-03-310000354707he:AmericanSavingsBankFSBMemberhe:GainLossOnSaleOfInvestmentsNetMember2022-01-012022-03-310000354707he:AmericanSavingsBankFSBMemberhe:GainLossOnSaleOfInvestmentsNetMember2021-01-012021-03-310000354707he:OtherIncomeNetMemberhe:AmericanSavingsBankFSBMember2022-01-012022-03-310000354707he:OtherIncomeNetMemberhe:AmericanSavingsBankFSBMember2021-01-012021-03-310000354707he:AmericanSavingsBankFSBMember2022-03-310000354707he:AmericanSavingsBankFSBMember2021-12-310000354707he:AmericanSavingsBankFSBMemberus-gaap:USTreasuryAndGovernmentMember2022-03-31he:issue0000354707he:AmericanSavingsBankFSBMemberus-gaap:MortgageBackedSecuritiesIssuedByUSGovernmentSponsoredEnterprisesMember2022-03-310000354707he:AmericanSavingsBankFSBMemberus-gaap:CorporateDebtSecuritiesMember2022-03-310000354707he:AmericanSavingsBankFSBMemberus-gaap:AssetBackedSecuritiesMember2022-03-310000354707he:AmericanSavingsBankFSBMemberus-gaap:USTreasuryAndGovernmentMember2021-12-310000354707he:AmericanSavingsBankFSBMemberus-gaap:MortgageBackedSecuritiesIssuedByUSGovernmentSponsoredEnterprisesMember2021-12-310000354707he:AmericanSavingsBankFSBMemberus-gaap:CorporateDebtSecuritiesMember2021-12-310000354707he:AmericanSavingsBankFSBMemberus-gaap:AssetBackedSecuritiesMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberhe:Residential14FamilyMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberhe:Residential14FamilyMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:CommercialRealEstateMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:CommercialRealEstateMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:HomeEquityLoanMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:HomeEquityLoanMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberhe:ResidentialLandMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberhe:ResidentialLandMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberhe:CommercialConstructionLoanMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberhe:CommercialConstructionLoanMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberhe:ResidentialConstructionLoanMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberhe:ResidentialConstructionLoanMember2021-12-310000354707he:RealEstatePortfolioSegmentMember2022-03-310000354707he:RealEstatePortfolioSegmentMember2021-12-310000354707us-gaap:CommercialPortfolioSegmentMember2022-03-310000354707us-gaap:CommercialPortfolioSegmentMember2021-12-310000354707us-gaap:ConsumerPortfolioSegmentMember2022-03-310000354707us-gaap:ConsumerPortfolioSegmentMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberhe:Residential14FamilyMember2022-01-012022-03-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:CommercialRealEstateMember2022-01-012022-03-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:HomeEquityLoanMember2022-01-012022-03-310000354707he:RealEstatePortfolioSegmentMemberhe:ResidentialLandMember2022-01-012022-03-310000354707he:RealEstatePortfolioSegmentMemberhe:CommercialConstructionLoanMember2022-01-012022-03-310000354707he:RealEstatePortfolioSegmentMemberhe:ResidentialConstructionLoanMember2022-01-012022-03-310000354707us-gaap:CommercialPortfolioSegmentMember2022-01-012022-03-310000354707us-gaap:ConsumerPortfolioSegmentMember2022-01-012022-03-310000354707he:RealEstatePortfolioSegmentMemberhe:Residential14FamilyMember2020-12-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:CommercialRealEstateMember2020-12-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:HomeEquityLoanMember2020-12-310000354707he:RealEstatePortfolioSegmentMemberhe:ResidentialLandMember2020-12-310000354707he:RealEstatePortfolioSegmentMemberhe:CommercialConstructionLoanMember2020-12-310000354707he:RealEstatePortfolioSegmentMemberhe:ResidentialConstructionLoanMember2020-12-310000354707us-gaap:CommercialPortfolioSegmentMember2020-12-310000354707us-gaap:ConsumerPortfolioSegmentMember2020-12-310000354707he:RealEstatePortfolioSegmentMemberhe:Residential14FamilyMember2021-01-012021-03-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:CommercialRealEstateMember2021-01-012021-03-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:HomeEquityLoanMember2021-01-012021-03-310000354707he:RealEstatePortfolioSegmentMemberhe:ResidentialLandMember2021-01-012021-03-310000354707he:RealEstatePortfolioSegmentMemberhe:CommercialConstructionLoanMember2021-01-012021-03-310000354707he:RealEstatePortfolioSegmentMemberhe:ResidentialConstructionLoanMember2021-01-012021-03-310000354707us-gaap:CommercialPortfolioSegmentMember2021-01-012021-03-310000354707us-gaap:ConsumerPortfolioSegmentMember2021-01-012021-03-310000354707he:RealEstatePortfolioSegmentMemberhe:Residential14FamilyMember2021-03-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:CommercialRealEstateMember2021-03-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:HomeEquityLoanMember2021-03-310000354707he:RealEstatePortfolioSegmentMemberhe:ResidentialLandMember2021-03-310000354707he:RealEstatePortfolioSegmentMemberhe:CommercialConstructionLoanMember2021-03-310000354707he:RealEstatePortfolioSegmentMemberhe:ResidentialConstructionLoanMember2021-03-310000354707us-gaap:CommercialPortfolioSegmentMember2021-03-310000354707us-gaap:ConsumerPortfolioSegmentMember2021-03-310000354707he:RealEstatePortfolioSegmentMemberhe:Residential14FamilyMemberus-gaap:FinancingReceivables1To29DaysPastDueMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberhe:Residential14FamilyMemberus-gaap:FinancingReceivables30To59DaysPastDueMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberhe:Residential14FamilyMemberus-gaap:FinancingReceivables60To89DaysPastDueMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberhe:Residential14FamilyMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:HomeEquityLoanMemberus-gaap:FinancingReceivables1To29DaysPastDueMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:FinancingReceivables30To59DaysPastDueMemberus-gaap:HomeEquityLoanMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:HomeEquityLoanMemberus-gaap:FinancingReceivables60To89DaysPastDueMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMemberus-gaap:HomeEquityLoanMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:FinancingReceivables1To29DaysPastDueMemberhe:ResidentialLandMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:FinancingReceivables30To59DaysPastDueMemberhe:ResidentialLandMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:FinancingReceivables60To89DaysPastDueMemberhe:ResidentialLandMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMemberhe:ResidentialLandMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:FinancingReceivables1To29DaysPastDueMemberhe:ResidentialConstructionLoanMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:FinancingReceivables30To59DaysPastDueMemberhe:ResidentialConstructionLoanMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:FinancingReceivables60To89DaysPastDueMemberhe:ResidentialConstructionLoanMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMemberhe:ResidentialConstructionLoanMember2022-03-310000354707us-gaap:ConsumerPortfolioSegmentMemberus-gaap:FinancingReceivables1To29DaysPastDueMember2022-03-310000354707us-gaap:ConsumerPortfolioSegmentMemberus-gaap:FinancingReceivables30To59DaysPastDueMember2022-03-310000354707us-gaap:ConsumerPortfolioSegmentMemberus-gaap:FinancingReceivables60To89DaysPastDueMember2022-03-310000354707us-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMemberus-gaap:ConsumerPortfolioSegmentMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:CommercialRealEstateMemberus-gaap:PassMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:CommercialRealEstateMemberus-gaap:SpecialMentionMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:SubstandardMemberus-gaap:CommercialRealEstateMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:CommercialRealEstateMemberus-gaap:DoubtfulMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:PassMemberhe:CommercialConstructionLoanMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:SpecialMentionMemberhe:CommercialConstructionLoanMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:SubstandardMemberhe:CommercialConstructionLoanMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:DoubtfulMemberhe:CommercialConstructionLoanMember2022-03-310000354707us-gaap:PassMemberus-gaap:CommercialPortfolioSegmentMember2022-03-310000354707us-gaap:CommercialPortfolioSegmentMemberus-gaap:SpecialMentionMember2022-03-310000354707us-gaap:SubstandardMemberus-gaap:CommercialPortfolioSegmentMember2022-03-310000354707us-gaap:DoubtfulMemberus-gaap:CommercialPortfolioSegmentMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberhe:Residential14FamilyMemberus-gaap:FinancingReceivables1To29DaysPastDueMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberhe:Residential14FamilyMemberus-gaap:FinancingReceivables30To59DaysPastDueMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberhe:Residential14FamilyMemberus-gaap:FinancingReceivables60To89DaysPastDueMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberhe:Residential14FamilyMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:HomeEquityLoanMemberus-gaap:FinancingReceivables1To29DaysPastDueMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:FinancingReceivables30To59DaysPastDueMemberus-gaap:HomeEquityLoanMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:HomeEquityLoanMemberus-gaap:FinancingReceivables60To89DaysPastDueMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMemberus-gaap:HomeEquityLoanMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:FinancingReceivables1To29DaysPastDueMemberhe:ResidentialLandMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:FinancingReceivables30To59DaysPastDueMemberhe:ResidentialLandMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:FinancingReceivables60To89DaysPastDueMemberhe:ResidentialLandMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMemberhe:ResidentialLandMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:FinancingReceivables1To29DaysPastDueMemberhe:ResidentialConstructionLoanMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:FinancingReceivables30To59DaysPastDueMemberhe:ResidentialConstructionLoanMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:FinancingReceivables60To89DaysPastDueMemberhe:ResidentialConstructionLoanMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMemberhe:ResidentialConstructionLoanMember2021-12-310000354707us-gaap:ConsumerPortfolioSegmentMemberus-gaap:FinancingReceivables1To29DaysPastDueMember2021-12-310000354707us-gaap:ConsumerPortfolioSegmentMemberus-gaap:FinancingReceivables30To59DaysPastDueMember2021-12-310000354707us-gaap:ConsumerPortfolioSegmentMemberus-gaap:FinancingReceivables60To89DaysPastDueMember2021-12-310000354707us-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMemberus-gaap:ConsumerPortfolioSegmentMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:CommercialRealEstateMemberus-gaap:PassMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:CommercialRealEstateMemberus-gaap:SpecialMentionMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:SubstandardMemberus-gaap:CommercialRealEstateMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:CommercialRealEstateMemberus-gaap:DoubtfulMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:PassMemberhe:CommercialConstructionLoanMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:SpecialMentionMemberhe:CommercialConstructionLoanMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:SubstandardMemberhe:CommercialConstructionLoanMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:DoubtfulMemberhe:CommercialConstructionLoanMember2021-12-310000354707us-gaap:PassMemberus-gaap:CommercialPortfolioSegmentMember2021-12-310000354707us-gaap:CommercialPortfolioSegmentMemberus-gaap:SpecialMentionMember2021-12-310000354707us-gaap:SubstandardMemberus-gaap:CommercialPortfolioSegmentMember2021-12-310000354707us-gaap:DoubtfulMemberus-gaap:CommercialPortfolioSegmentMember2021-12-310000354707us-gaap:HomeEquityLoanMember2022-01-012022-03-310000354707us-gaap:HomeEquityLoanMember2021-01-012021-03-310000354707he:RealEstatePortfolioSegmentMemberhe:Residential14FamilyMemberus-gaap:FinancialAssetPastDueMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberhe:Residential14FamilyMemberus-gaap:FinancialAssetNotPastDueMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:CommercialRealEstateMemberus-gaap:FinancingReceivables30To59DaysPastDueMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:CommercialRealEstateMemberus-gaap:FinancingReceivables60To89DaysPastDueMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMemberus-gaap:CommercialRealEstateMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:CommercialRealEstateMemberus-gaap:FinancialAssetPastDueMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:FinancialAssetNotPastDueMemberus-gaap:CommercialRealEstateMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:HomeEquityLoanMemberus-gaap:FinancialAssetPastDueMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:FinancialAssetNotPastDueMemberus-gaap:HomeEquityLoanMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberhe:ResidentialLandMemberus-gaap:FinancialAssetPastDueMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:FinancialAssetNotPastDueMemberhe:ResidentialLandMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:FinancingReceivables30To59DaysPastDueMemberhe:CommercialConstructionLoanMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:FinancingReceivables60To89DaysPastDueMemberhe:CommercialConstructionLoanMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMemberhe:CommercialConstructionLoanMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:FinancialAssetPastDueMemberhe:CommercialConstructionLoanMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:FinancialAssetNotPastDueMemberhe:CommercialConstructionLoanMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberhe:ResidentialConstructionLoanMemberus-gaap:FinancialAssetPastDueMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:FinancialAssetNotPastDueMemberhe:ResidentialConstructionLoanMember2022-03-310000354707us-gaap:FinancingReceivables30To59DaysPastDueMemberus-gaap:CommercialPortfolioSegmentMember2022-03-310000354707us-gaap:CommercialPortfolioSegmentMemberus-gaap:FinancingReceivables60To89DaysPastDueMember2022-03-310000354707us-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMemberus-gaap:CommercialPortfolioSegmentMember2022-03-310000354707us-gaap:CommercialPortfolioSegmentMemberus-gaap:FinancialAssetPastDueMember2022-03-310000354707us-gaap:FinancialAssetNotPastDueMemberus-gaap:CommercialPortfolioSegmentMember2022-03-310000354707us-gaap:ConsumerPortfolioSegmentMemberus-gaap:FinancialAssetPastDueMember2022-03-310000354707us-gaap:FinancialAssetNotPastDueMemberus-gaap:ConsumerPortfolioSegmentMember2022-03-310000354707us-gaap:FinancingReceivables30To59DaysPastDueMember2022-03-310000354707us-gaap:FinancingReceivables60To89DaysPastDueMember2022-03-310000354707us-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMember2022-03-310000354707us-gaap:FinancialAssetPastDueMember2022-03-310000354707us-gaap:FinancialAssetNotPastDueMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberhe:Residential14FamilyMemberus-gaap:FinancialAssetPastDueMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberhe:Residential14FamilyMemberus-gaap:FinancialAssetNotPastDueMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:CommercialRealEstateMemberus-gaap:FinancingReceivables30To59DaysPastDueMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:CommercialRealEstateMemberus-gaap:FinancingReceivables60To89DaysPastDueMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMemberus-gaap:CommercialRealEstateMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:CommercialRealEstateMemberus-gaap:FinancialAssetPastDueMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:FinancialAssetNotPastDueMemberus-gaap:CommercialRealEstateMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:HomeEquityLoanMemberus-gaap:FinancialAssetPastDueMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:FinancialAssetNotPastDueMemberus-gaap:HomeEquityLoanMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberhe:ResidentialLandMemberus-gaap:FinancialAssetPastDueMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:FinancialAssetNotPastDueMemberhe:ResidentialLandMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:FinancingReceivables30To59DaysPastDueMemberhe:CommercialConstructionLoanMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:FinancingReceivables60To89DaysPastDueMemberhe:CommercialConstructionLoanMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMemberhe:CommercialConstructionLoanMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:FinancialAssetPastDueMemberhe:CommercialConstructionLoanMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:FinancialAssetNotPastDueMemberhe:CommercialConstructionLoanMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberhe:ResidentialConstructionLoanMemberus-gaap:FinancialAssetPastDueMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:FinancialAssetNotPastDueMemberhe:ResidentialConstructionLoanMember2021-12-310000354707us-gaap:FinancingReceivables30To59DaysPastDueMemberus-gaap:CommercialPortfolioSegmentMember2021-12-310000354707us-gaap:CommercialPortfolioSegmentMemberus-gaap:FinancingReceivables60To89DaysPastDueMember2021-12-310000354707us-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMemberus-gaap:CommercialPortfolioSegmentMember2021-12-310000354707us-gaap:CommercialPortfolioSegmentMemberus-gaap:FinancialAssetPastDueMember2021-12-310000354707us-gaap:FinancialAssetNotPastDueMemberus-gaap:CommercialPortfolioSegmentMember2021-12-310000354707us-gaap:ConsumerPortfolioSegmentMemberus-gaap:FinancialAssetPastDueMember2021-12-310000354707us-gaap:FinancialAssetNotPastDueMemberus-gaap:ConsumerPortfolioSegmentMember2021-12-310000354707us-gaap:FinancingReceivables30To59DaysPastDueMember2021-12-310000354707us-gaap:FinancingReceivables60To89DaysPastDueMember2021-12-310000354707us-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMember2021-12-310000354707us-gaap:FinancialAssetPastDueMember2021-12-310000354707us-gaap:FinancialAssetNotPastDueMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberhe:Residential14FamilyMember2021-01-012021-06-300000354707he:RealEstatePortfolioSegmentMemberus-gaap:CommercialRealEstateMember2021-01-012021-06-300000354707he:RealEstatePortfolioSegmentMemberus-gaap:HomeEquityLoanMember2021-01-012021-06-300000354707he:RealEstatePortfolioSegmentMemberhe:ResidentialLandMember2021-01-012021-06-300000354707he:RealEstatePortfolioSegmentMemberhe:CommercialConstructionLoanMember2021-01-012021-06-300000354707he:RealEstatePortfolioSegmentMemberhe:ResidentialConstructionLoanMember2021-01-012021-06-300000354707us-gaap:CommercialPortfolioSegmentMember2021-01-012021-06-300000354707us-gaap:ConsumerPortfolioSegmentMember2021-01-012021-06-3000003547072021-01-012021-06-300000354707he:RealEstatePortfolioSegmentMemberhe:Residential14FamilyMemberhe:FinancingReceivableTroubledDebtRestructuringsRealEstateLoansMember2021-01-012021-03-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:CommercialRealEstateMemberhe:FinancingReceivableTroubledDebtRestructuringsRealEstateLoansMember2021-01-012021-03-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:HomeEquityLoanMemberhe:FinancingReceivableTroubledDebtRestructuringsRealEstateLoansMember2021-01-012021-03-310000354707he:RealEstatePortfolioSegmentMemberhe:ResidentialLandMemberhe:FinancingReceivableTroubledDebtRestructuringsRealEstateLoansMember2021-01-012021-03-310000354707he:RealEstatePortfolioSegmentMemberhe:FinancingReceivableTroubledDebtRestructuringsRealEstateLoansMemberhe:CommercialConstructionLoanMember2021-01-012021-03-310000354707he:RealEstatePortfolioSegmentMemberhe:ResidentialConstructionLoanMemberhe:FinancingReceivableTroubledDebtRestructuringsRealEstateLoansMember2021-01-012021-03-310000354707us-gaap:CommercialPortfolioSegmentMemberhe:FinancingReceivableTroubledDebtRestructuringsRealEstateLoansMember2021-01-012021-03-310000354707us-gaap:ConsumerPortfolioSegmentMemberhe:FinancingReceivableTroubledDebtRestructuringsRealEstateLoansMember2021-01-012021-03-310000354707he:FinancingReceivableTroubledDebtRestructuringsRealEstateLoansMember2021-01-012021-03-310000354707he:FinancingReceivableTroubledDebtRestructuringsRealEstateLoansMember2022-01-012022-03-310000354707he:FinancingReceivableTroubledDebtRestructuringsRealEstateLoansMember2022-03-310000354707he:FinancingReceivableTroubledDebtRestructuringsRealEstateLoansMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberhe:Residential14FamilyMemberus-gaap:ResidentialRealEstateMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberhe:Residential14FamilyMemberus-gaap:ResidentialRealEstateMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:CommercialRealEstateMemberus-gaap:CommercialRealEstateMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:CommercialRealEstateMemberus-gaap:CommercialRealEstateMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:ResidentialRealEstateMemberus-gaap:HomeEquityLoanMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:ResidentialRealEstateMemberus-gaap:HomeEquityLoanMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:ResidentialRealEstateMemberhe:ResidentialLandMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:ResidentialRealEstateMemberhe:ResidentialLandMember2021-12-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:CollateralPledgedMember2022-03-310000354707he:RealEstatePortfolioSegmentMemberus-gaap:CollateralPledgedMember2021-12-310000354707he:BusinessAssetsMemberus-gaap:CommercialPortfolioSegmentMember2022-03-310000354707he:BusinessAssetsMemberus-gaap:CommercialPortfolioSegmentMember2021-12-310000354707us-gaap:CollateralPledgedMember2022-03-310000354707us-gaap:CollateralPledgedMember2021-12-310000354707he:AmericanSavingsBankFSBMemberus-gaap:ResidentialMortgageMember2022-01-012022-03-310000354707he:AmericanSavingsBankFSBMemberus-gaap:ResidentialMortgageMember2021-01-012021-03-310000354707he:AmericanSavingsBankFSBMemberus-gaap:ServicingContractsMember2022-03-310000354707he:AmericanSavingsBankFSBMemberus-gaap:ServicingContractsMember2021-12-310000354707he:AmericanSavingsBankFSBMemberus-gaap:ServicingContractsMember2020-12-310000354707he:AmericanSavingsBankFSBMemberus-gaap:ServicingContractsMember2022-01-012022-03-310000354707he:AmericanSavingsBankFSBMemberus-gaap:ServicingContractsMember2021-01-012021-03-310000354707he:AmericanSavingsBankFSBMemberus-gaap:ServicingContractsMember2021-03-310000354707he:AmericanSavingsBankFSBMemberus-gaap:ServicingContractsMemberhe:MeasurementInputNoteInterestRateMember2022-03-310000354707he:AmericanSavingsBankFSBMemberus-gaap:ServicingContractsMemberhe:MeasurementInputNoteInterestRateMember2021-12-310000354707he:AmericanSavingsBankFSBMemberus-gaap:MeasurementInputDiscountRateMemberus-gaap:ServicingContractsMember2022-03-310000354707he:AmericanSavingsBankFSBMemberus-gaap:MeasurementInputDiscountRateMemberus-gaap:ServicingContractsMember2021-12-310000354707he:AmericanSavingsBankFSBMemberus-gaap:MeasurementInputPrepaymentRateMemberus-gaap:ServicingContractsMember2022-03-310000354707he:AmericanSavingsBankFSBMemberus-gaap:MeasurementInputPrepaymentRateMemberus-gaap:ServicingContractsMember2021-12-310000354707he:CommercialAccountHoldersMember2022-03-310000354707he:CommercialAccountHoldersMember2021-12-310000354707us-gaap:InterestRateLockCommitmentsMemberus-gaap:NondesignatedMember2022-03-310000354707us-gaap:InterestRateLockCommitmentsMemberus-gaap:NondesignatedMember2021-12-310000354707us-gaap:NondesignatedMemberus-gaap:ForwardContractsMember2022-03-310000354707us-gaap:NondesignatedMemberus-gaap:ForwardContractsMember2021-12-310000354707us-gaap:NondesignatedMember2022-03-310000354707us-gaap:NondesignatedMember2021-12-310000354707us-gaap:InterestRateLockCommitmentsMemberus-gaap:NondesignatedMemberhe:FeesandCommissionsMortgageBankingMember2022-01-012022-03-310000354707us-gaap:InterestRateLockCommitmentsMemberus-gaap:NondesignatedMemberhe:FeesandCommissionsMortgageBankingMember2021-01-012021-03-310000354707us-gaap:NondesignatedMemberus-gaap:ForwardContractsMemberhe:FeesandCommissionsMortgageBankingMember2022-01-012022-03-310000354707us-gaap:NondesignatedMemberus-gaap:ForwardContractsMemberhe:FeesandCommissionsMortgageBankingMember2021-01-012021-03-310000354707us-gaap:NondesignatedMember2022-01-012022-03-310000354707us-gaap:NondesignatedMember2021-01-012021-03-310000354707he:CreditFacilitiesMemberhe:HawaiianElectricCompanyAndSubsidiariesMember2021-05-14he:institution0000354707he:HawaiianElectricCompanyAndSubsidiariesMemberhe:HEIFacilityMember2021-05-140000354707us-gaap:LineOfCreditMemberhe:HawaiianElectricFacilityMemberhe:HawaiianElectricCompanyAndSubsidiariesMember2021-05-140000354707he:HawaiianElectricFacilityMemberhe:HawaiianElectricCompanyAndSubsidiariesMember2021-05-14he:extensionOption0000354707he:HawaiianElectricFacilityMemberhe:HawaiianElectricCompanyAndSubsidiariesMember2021-05-142021-05-140000354707he:CreditFacilitiesMemberhe:HawaiianElectricCompanyAndSubsidiariesMember2021-12-310000354707he:CreditFacilitiesMemberhe:HawaiianElectricCompanyAndSubsidiariesMember2022-03-310000354707us-gaap:AccumulatedNetUnrealizedInvestmentGainLossMember2021-12-310000354707us-gaap:AociDerivativeQualifyingAsHedgeExcludedComponentParentMember2021-12-310000354707us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2021-12-310000354707he:HawaiianElectricCompanyAndSubsidiariesMemberus-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2021-12-310000354707us-gaap:AccumulatedNetUnrealizedInvestmentGainLossMember2022-01-012022-03-310000354707us-gaap:AociDerivativeQualifyingAsHedgeExcludedComponentParentMember2022-01-012022-03-310000354707us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2022-01-012022-03-310000354707he:HawaiianElectricCompanyAndSubsidiariesMemberus-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2022-01-012022-03-310000354707us-gaap:AccumulatedNetUnrealizedInvestmentGainLossMember2022-03-310000354707us-gaap:AociDerivativeQualifyingAsHedgeExcludedComponentParentMember2022-03-310000354707us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2022-03-310000354707he:HawaiianElectricCompanyAndSubsidiariesMemberus-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2022-03-310000354707us-gaap:AccumulatedNetUnrealizedInvestmentGainLossMember2020-12-310000354707us-gaap:AociDerivativeQualifyingAsHedgeExcludedComponentParentMember2020-12-310000354707us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2020-12-310000354707he:HawaiianElectricCompanyAndSubsidiariesMemberus-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2020-12-310000354707us-gaap:AccumulatedNetUnrealizedInvestmentGainLossMember2021-01-012021-03-310000354707us-gaap:AociDerivativeQualifyingAsHedgeExcludedComponentParentMember2021-01-012021-03-310000354707us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2021-01-012021-03-310000354707he:HawaiianElectricCompanyAndSubsidiariesMemberus-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2021-01-012021-03-310000354707us-gaap:AccumulatedNetUnrealizedInvestmentGainLossMember2021-03-310000354707us-gaap:AociDerivativeQualifyingAsHedgeExcludedComponentParentMember2021-03-310000354707us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2021-03-310000354707he:HawaiianElectricCompanyAndSubsidiariesMemberus-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2021-03-310000354707us-gaap:AccumulatedNetUnrealizedInvestmentGainLossMemberus-gaap:ReclassificationOutOfAccumulatedOtherComprehensiveIncomeMember2022-01-012022-03-310000354707us-gaap:AccumulatedNetUnrealizedInvestmentGainLossMemberus-gaap:ReclassificationOutOfAccumulatedOtherComprehensiveIncomeMember2021-01-012021-03-310000354707us-gaap:AccumulatedGainLossNetCashFlowHedgeParentMemberus-gaap:ReclassificationOutOfAccumulatedOtherComprehensiveIncomeMember2022-01-012022-03-310000354707us-gaap:AccumulatedGainLossNetCashFlowHedgeParentMemberus-gaap:ReclassificationOutOfAccumulatedOtherComprehensiveIncomeMember2021-01-012021-03-310000354707us-gaap:AccumulatedDefinedBenefitPlansAdjustmentNetPriorServiceCostCreditMemberus-gaap:ReclassificationOutOfAccumulatedOtherComprehensiveIncomeMember2022-01-012022-03-310000354707us-gaap:AccumulatedDefinedBenefitPlansAdjustmentNetPriorServiceCostCreditMemberus-gaap:ReclassificationOutOfAccumulatedOtherComprehensiveIncomeMember2021-01-012021-03-310000354707he:AccumulatedDefinedBenefitPlansAdjustmentImpactOfDecisionAndOrdersOfThePublicUtilityCommissionIncludedInRegulatoryAssetsMemberus-gaap:ReclassificationOutOfAccumulatedOtherComprehensiveIncomeMember2022-01-012022-03-310000354707he:AccumulatedDefinedBenefitPlansAdjustmentImpactOfDecisionAndOrdersOfThePublicUtilityCommissionIncludedInRegulatoryAssetsMemberus-gaap:ReclassificationOutOfAccumulatedOtherComprehensiveIncomeMember2021-01-012021-03-310000354707us-gaap:ReclassificationOutOfAccumulatedOtherComprehensiveIncomeMember2022-01-012022-03-310000354707us-gaap:ReclassificationOutOfAccumulatedOtherComprehensiveIncomeMember2021-01-012021-03-310000354707us-gaap:AccumulatedDefinedBenefitPlansAdjustmentNetPriorServiceCostCreditMemberhe:HawaiianElectricCompanyAndSubsidiariesMemberus-gaap:ReclassificationOutOfAccumulatedOtherComprehensiveIncomeMember2022-01-012022-03-310000354707us-gaap:AccumulatedDefinedBenefitPlansAdjustmentNetPriorServiceCostCreditMemberhe:HawaiianElectricCompanyAndSubsidiariesMemberus-gaap:ReclassificationOutOfAccumulatedOtherComprehensiveIncomeMember2021-01-012021-03-310000354707he:AccumulatedDefinedBenefitPlansAdjustmentImpactOfDecisionAndOrdersOfThePublicUtilityCommissionIncludedInRegulatoryAssetsMemberhe:HawaiianElectricCompanyAndSubsidiariesMemberus-gaap:ReclassificationOutOfAccumulatedOtherComprehensiveIncomeMember2022-01-012022-03-310000354707he:AccumulatedDefinedBenefitPlansAdjustmentImpactOfDecisionAndOrdersOfThePublicUtilityCommissionIncludedInRegulatoryAssetsMemberhe:HawaiianElectricCompanyAndSubsidiariesMemberus-gaap:ReclassificationOutOfAccumulatedOtherComprehensiveIncomeMember2021-01-012021-03-310000354707he:HawaiianElectricCompanyAndSubsidiariesMemberus-gaap:ReclassificationOutOfAccumulatedOtherComprehensiveIncomeMember2022-01-012022-03-310000354707he:HawaiianElectricCompanyAndSubsidiariesMemberus-gaap:ReclassificationOutOfAccumulatedOtherComprehensiveIncomeMember2021-01-012021-03-310000354707he:ElectricEnergySalesResidentialMemberhe:ElectricUtilitySegmentMember2022-01-012022-03-310000354707he:ElectricEnergySalesResidentialMemberhe:BankingSegmentMember2022-01-012022-03-310000354707he:ElectricEnergySalesResidentialMemberus-gaap:AllOtherSegmentsMember2022-01-012022-03-310000354707he:ElectricEnergySalesResidentialMember2022-01-012022-03-310000354707he:ElectricUtilitySegmentMemberhe:ElectricEnergySalesCommercialMember2022-01-012022-03-310000354707he:BankingSegmentMemberhe:ElectricEnergySalesCommercialMember2022-01-012022-03-310000354707us-gaap:AllOtherSegmentsMemberhe:ElectricEnergySalesCommercialMember2022-01-012022-03-310000354707he:ElectricEnergySalesCommercialMember2022-01-012022-03-310000354707he:ElectricEnergySalesLargeLightAndPowerMemberhe:ElectricUtilitySegmentMember2022-01-012022-03-310000354707he:ElectricEnergySalesLargeLightAndPowerMemberhe:BankingSegmentMember2022-01-012022-03-310000354707he:ElectricEnergySalesLargeLightAndPowerMemberus-gaap:AllOtherSegmentsMember2022-01-012022-03-310000354707he:ElectricEnergySalesLargeLightAndPowerMember2022-01-012022-03-310000354707he:ElectricEnergySalesOtherMemberhe:ElectricUtilitySegmentMember2022-01-012022-03-310000354707he:ElectricEnergySalesOtherMemberhe:BankingSegmentMember2022-01-012022-03-310000354707he:ElectricEnergySalesOtherMemberus-gaap:AllOtherSegmentsMember2022-01-012022-03-310000354707he:ElectricEnergySalesOtherMember2022-01-012022-03-310000354707he:BankFeesMemberhe:ElectricUtilitySegmentMember2022-01-012022-03-310000354707he:BankFeesMemberhe:BankingSegmentMember2022-01-012022-03-310000354707he:BankFeesMemberus-gaap:AllOtherSegmentsMember2022-01-012022-03-310000354707he:BankFeesMember2022-01-012022-03-310000354707he:OtherSalesMemberhe:ElectricUtilitySegmentMember2022-01-012022-03-310000354707he:OtherSalesMemberhe:BankingSegmentMember2022-01-012022-03-310000354707he:OtherSalesMemberus-gaap:AllOtherSegmentsMember2022-01-012022-03-310000354707he:OtherSalesMember2022-01-012022-03-310000354707he:RegulatoryRevenueMemberhe:ElectricUtilitySegmentMember2022-01-012022-03-310000354707he:RegulatoryRevenueMemberhe:BankingSegmentMember2022-01-012022-03-310000354707he:RegulatoryRevenueMemberus-gaap:AllOtherSegmentsMember2022-01-012022-03-310000354707he:RegulatoryRevenueMember2022-01-012022-03-310000354707he:BankInterestAndDividendIncomeMemberhe:ElectricUtilitySegmentMember2022-01-012022-03-310000354707he:BankInterestAndDividendIncomeMemberhe:BankingSegmentMember2022-01-012022-03-310000354707he:BankInterestAndDividendIncomeMemberus-gaap:AllOtherSegmentsMember2022-01-012022-03-310000354707he:BankInterestAndDividendIncomeMember2022-01-012022-03-310000354707he:ElectricUtilitySegmentMemberhe:OtherBankNoninterestIncomeMember2022-01-012022-03-310000354707he:BankingSegmentMemberhe:OtherBankNoninterestIncomeMember2022-01-012022-03-310000354707us-gaap:AllOtherSegmentsMemberhe:OtherBankNoninterestIncomeMember2022-01-012022-03-310000354707he:OtherBankNoninterestIncomeMember2022-01-012022-03-310000354707us-gaap:ProductAndServiceOtherMemberhe:ElectricUtilitySegmentMember2022-01-012022-03-310000354707us-gaap:ProductAndServiceOtherMemberhe:BankingSegmentMember2022-01-012022-03-310000354707us-gaap:ProductAndServiceOtherMemberus-gaap:AllOtherSegmentsMember2022-01-012022-03-310000354707us-gaap:ProductAndServiceOtherMember2022-01-012022-03-310000354707us-gaap:TransferredAtPointInTimeMemberhe:ElectricUtilitySegmentMember2022-01-012022-03-310000354707us-gaap:TransferredAtPointInTimeMemberhe:BankingSegmentMember2022-01-012022-03-310000354707us-gaap:TransferredAtPointInTimeMemberus-gaap:AllOtherSegmentsMember2022-01-012022-03-310000354707us-gaap:TransferredAtPointInTimeMember2022-01-012022-03-310000354707us-gaap:TransferredOverTimeMemberhe:ElectricUtilitySegmentMember2022-01-012022-03-310000354707us-gaap:TransferredOverTimeMemberhe:BankingSegmentMember2022-01-012022-03-310000354707us-gaap:TransferredOverTimeMemberus-gaap:AllOtherSegmentsMember2022-01-012022-03-310000354707us-gaap:TransferredOverTimeMember2022-01-012022-03-310000354707he:ElectricEnergySalesResidentialMemberhe:ElectricUtilitySegmentMember2021-01-012021-03-310000354707he:ElectricEnergySalesResidentialMemberhe:BankingSegmentMember2021-01-012021-03-310000354707he:ElectricEnergySalesResidentialMemberus-gaap:AllOtherSegmentsMember2021-01-012021-03-310000354707he:ElectricEnergySalesResidentialMember2021-01-012021-03-310000354707he:ElectricUtilitySegmentMemberhe:ElectricEnergySalesCommercialMember2021-01-012021-03-310000354707he:BankingSegmentMemberhe:ElectricEnergySalesCommercialMember2021-01-012021-03-310000354707us-gaap:AllOtherSegmentsMemberhe:ElectricEnergySalesCommercialMember2021-01-012021-03-310000354707he:ElectricEnergySalesCommercialMember2021-01-012021-03-310000354707he:ElectricEnergySalesLargeLightAndPowerMemberhe:ElectricUtilitySegmentMember2021-01-012021-03-310000354707he:ElectricEnergySalesLargeLightAndPowerMemberhe:BankingSegmentMember2021-01-012021-03-310000354707he:ElectricEnergySalesLargeLightAndPowerMemberus-gaap:AllOtherSegmentsMember2021-01-012021-03-310000354707he:ElectricEnergySalesLargeLightAndPowerMember2021-01-012021-03-310000354707he:ElectricEnergySalesOtherMemberhe:ElectricUtilitySegmentMember2021-01-012021-03-310000354707he:ElectricEnergySalesOtherMemberhe:BankingSegmentMember2021-01-012021-03-310000354707he:ElectricEnergySalesOtherMemberus-gaap:AllOtherSegmentsMember2021-01-012021-03-310000354707he:ElectricEnergySalesOtherMember2021-01-012021-03-310000354707he:BankFeesMemberhe:ElectricUtilitySegmentMember2021-01-012021-03-310000354707he:BankFeesMemberhe:BankingSegmentMember2021-01-012021-03-310000354707he:BankFeesMemberus-gaap:AllOtherSegmentsMember2021-01-012021-03-310000354707he:BankFeesMember2021-01-012021-03-310000354707he:OtherSalesMemberhe:ElectricUtilitySegmentMember2021-01-012021-03-310000354707he:OtherSalesMemberhe:BankingSegmentMember2021-01-012021-03-310000354707he:OtherSalesMemberus-gaap:AllOtherSegmentsMember2021-01-012021-03-310000354707he:OtherSalesMember2021-01-012021-03-310000354707he:RegulatoryRevenueMemberhe:ElectricUtilitySegmentMember2021-01-012021-03-310000354707he:RegulatoryRevenueMemberhe:BankingSegmentMember2021-01-012021-03-310000354707he:RegulatoryRevenueMemberus-gaap:AllOtherSegmentsMember2021-01-012021-03-310000354707he:RegulatoryRevenueMember2021-01-012021-03-310000354707he:BankInterestAndDividendIncomeMemberhe:ElectricUtilitySegmentMember2021-01-012021-03-310000354707he:BankInterestAndDividendIncomeMemberhe:BankingSegmentMember2021-01-012021-03-310000354707he:BankInterestAndDividendIncomeMemberus-gaap:AllOtherSegmentsMember2021-01-012021-03-310000354707he:BankInterestAndDividendIncomeMember2021-01-012021-03-310000354707he:ElectricUtilitySegmentMemberhe:OtherBankNoninterestIncomeMember2021-01-012021-03-310000354707he:BankingSegmentMemberhe:OtherBankNoninterestIncomeMember2021-01-012021-03-310000354707us-gaap:AllOtherSegmentsMemberhe:OtherBankNoninterestIncomeMember2021-01-012021-03-310000354707he:OtherBankNoninterestIncomeMember2021-01-012021-03-310000354707us-gaap:ProductAndServiceOtherMemberhe:ElectricUtilitySegmentMember2021-01-012021-03-310000354707us-gaap:ProductAndServiceOtherMemberhe:BankingSegmentMember2021-01-012021-03-310000354707us-gaap:ProductAndServiceOtherMemberus-gaap:AllOtherSegmentsMember2021-01-012021-03-310000354707us-gaap:ProductAndServiceOtherMember2021-01-012021-03-310000354707us-gaap:TransferredAtPointInTimeMemberhe:ElectricUtilitySegmentMember2021-01-012021-03-310000354707us-gaap:TransferredAtPointInTimeMemberhe:BankingSegmentMember2021-01-012021-03-310000354707us-gaap:TransferredAtPointInTimeMemberus-gaap:AllOtherSegmentsMember2021-01-012021-03-310000354707us-gaap:TransferredAtPointInTimeMember2021-01-012021-03-310000354707us-gaap:TransferredOverTimeMemberhe:ElectricUtilitySegmentMember2021-01-012021-03-310000354707us-gaap:TransferredOverTimeMemberhe:BankingSegmentMember2021-01-012021-03-310000354707us-gaap:TransferredOverTimeMemberus-gaap:AllOtherSegmentsMember2021-01-012021-03-310000354707us-gaap:TransferredOverTimeMember2021-01-012021-03-310000354707us-gaap:PensionPlansDefinedBenefitMember2022-01-012022-03-310000354707us-gaap:PensionPlansDefinedBenefitMember2021-01-012021-03-310000354707us-gaap:OtherPostretirementBenefitPlansDefinedBenefitMember2022-01-012022-03-310000354707us-gaap:OtherPostretirementBenefitPlansDefinedBenefitMember2021-01-012021-03-310000354707us-gaap:PensionPlansDefinedBenefitMemberhe:HawaiianElectricCompanyAndSubsidiariesMember2022-01-012022-03-310000354707us-gaap:PensionPlansDefinedBenefitMemberhe:HawaiianElectricCompanyAndSubsidiariesMember2021-01-012021-03-310000354707us-gaap:OtherPostretirementBenefitPlansDefinedBenefitMemberhe:HawaiianElectricCompanyAndSubsidiariesMember2022-01-012022-03-310000354707us-gaap:OtherPostretirementBenefitPlansDefinedBenefitMemberhe:HawaiianElectricCompanyAndSubsidiariesMember2021-01-012021-03-310000354707he:EquityAndIncentivePlanMember2014-03-012014-03-010000354707he:EquityAndIncentivePlanMember2022-03-310000354707he:NonemployeeDirectorStockPlanMember2022-03-310000354707us-gaap:ShareBasedPaymentArrangementNonemployeeMember2022-01-012022-03-310000354707us-gaap:ShareBasedPaymentArrangementNonemployeeMember2021-01-012021-03-310000354707us-gaap:RestrictedStockUnitsRSUMember2021-12-310000354707us-gaap:RestrictedStockUnitsRSUMember2020-12-310000354707us-gaap:RestrictedStockUnitsRSUMember2022-01-012022-03-310000354707us-gaap:RestrictedStockUnitsRSUMember2021-01-012021-03-310000354707us-gaap:RestrictedStockUnitsRSUMember2022-03-310000354707us-gaap:RestrictedStockUnitsRSUMember2021-03-310000354707he:LongTermIncentivePlanMember2022-01-012022-03-310000354707he:LongTermIncentivePlanLinkedToTotalReturnToShareholdersMember2021-12-310000354707he:LongTermIncentivePlanLinkedToTotalReturnToShareholdersMember2020-12-310000354707he:LongTermIncentivePlanLinkedToTotalReturnToShareholdersMember2022-01-012022-03-310000354707he:LongTermIncentivePlanLinkedToTotalReturnToShareholdersMember2021-01-012021-03-310000354707he:LongTermIncentivePlanLinkedToTotalReturnToShareholdersMember2022-03-310000354707he:LongTermIncentivePlanLinkedToTotalReturnToShareholdersMember2021-03-310000354707srt:ScenarioForecastMemberhe:LongTermIncentivePlanLinkedToTotalReturnToShareholdersMember2022-01-012022-12-310000354707he:LongTermIncentivePlanLinkedToTotalReturnToShareholdersMember2021-01-012021-12-310000354707srt:ScenarioForecastMemberhe:LongTermIncentivePlanLinkedToTotalReturnToShareholdersMember2022-12-310000354707he:LongTermIncentivePlanAwardsLinkedToOtherPerformanceConditionsMember2021-12-310000354707he:LongTermIncentivePlanAwardsLinkedToOtherPerformanceConditionsMember2020-12-310000354707he:LongTermIncentivePlanAwardsLinkedToOtherPerformanceConditionsMember2022-01-012022-03-310000354707he:LongTermIncentivePlanAwardsLinkedToOtherPerformanceConditionsMember2021-01-012021-03-310000354707he:LongTermIncentivePlanAwardsLinkedToOtherPerformanceConditionsMember2022-03-310000354707he:LongTermIncentivePlanAwardsLinkedToOtherPerformanceConditionsMember2021-03-310000354707us-gaap:CarryingReportedAmountFairValueDisclosureMember2022-03-310000354707us-gaap:FairValueInputsLevel1Memberus-gaap:EstimateOfFairValueFairValueDisclosureMember2022-03-310000354707us-gaap:FairValueInputsLevel2Memberus-gaap:EstimateOfFairValueFairValueDisclosureMember2022-03-310000354707us-gaap:FairValueInputsLevel3Memberus-gaap:EstimateOfFairValueFairValueDisclosureMember2022-03-310000354707us-gaap:EstimateOfFairValueFairValueDisclosureMember2022-03-310000354707us-gaap:CarryingReportedAmountFairValueDisclosureMemberhe:HawaiianElectricCompanyAndSubsidiariesMember2022-03-310000354707us-gaap:FairValueInputsLevel1Memberhe:HawaiianElectricCompanyAndSubsidiariesMemberus-gaap:EstimateOfFairValueFairValueDisclosureMember2022-03-310000354707us-gaap:FairValueInputsLevel2Memberhe:HawaiianElectricCompanyAndSubsidiariesMemberus-gaap:EstimateOfFairValueFairValueDisclosureMember2022-03-310000354707us-gaap:FairValueInputsLevel3Memberhe:HawaiianElectricCompanyAndSubsidiariesMemberus-gaap:EstimateOfFairValueFairValueDisclosureMember2022-03-310000354707he:HawaiianElectricCompanyAndSubsidiariesMemberus-gaap:EstimateOfFairValueFairValueDisclosureMember2022-03-310000354707us-gaap:CarryingReportedAmountFairValueDisclosureMember2021-12-310000354707us-gaap:FairValueInputsLevel1Memberus-gaap:EstimateOfFairValueFairValueDisclosureMember2021-12-310000354707us-gaap:FairValueInputsLevel2Memberus-gaap:EstimateOfFairValueFairValueDisclosureMember2021-12-310000354707us-gaap:FairValueInputsLevel3Memberus-gaap:EstimateOfFairValueFairValueDisclosureMember2021-12-310000354707us-gaap:EstimateOfFairValueFairValueDisclosureMember2021-12-310000354707us-gaap:CarryingReportedAmountFairValueDisclosureMemberhe:HawaiianElectricCompanyAndSubsidiariesMember2021-12-310000354707us-gaap:FairValueInputsLevel1Memberhe:HawaiianElectricCompanyAndSubsidiariesMemberus-gaap:EstimateOfFairValueFairValueDisclosureMember2021-12-310000354707us-gaap:FairValueInputsLevel2Memberhe:HawaiianElectricCompanyAndSubsidiariesMemberus-gaap:EstimateOfFairValueFairValueDisclosureMember2021-12-310000354707us-gaap:FairValueInputsLevel3Memberhe:HawaiianElectricCompanyAndSubsidiariesMemberus-gaap:EstimateOfFairValueFairValueDisclosureMember2021-12-310000354707he:HawaiianElectricCompanyAndSubsidiariesMemberus-gaap:EstimateOfFairValueFairValueDisclosureMember2021-12-310000354707us-gaap:FairValueMeasurementsRecurringMemberus-gaap:MortgageBackedSecuritiesIssuedByUSGovernmentSponsoredEnterprisesMemberus-gaap:FairValueInputsLevel1Memberhe:BankingSegmentMember2022-03-310000354707us-gaap:FairValueMeasurementsRecurringMemberus-gaap:MortgageBackedSecuritiesIssuedByUSGovernmentSponsoredEnterprisesMemberus-gaap:FairValueInputsLevel2Memberhe:BankingSegmentMember2022-03-310000354707us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel3Memberus-gaap:MortgageBackedSecuritiesIssuedByUSGovernmentSponsoredEnterprisesMemberhe:BankingSegmentMember2022-03-310000354707us-gaap:FairValueMeasurementsRecurringMemberus-gaap:MortgageBackedSecuritiesIssuedByUSGovernmentSponsoredEnterprisesMemberus-gaap:FairValueInputsLevel1Memberhe:BankingSegmentMember2021-12-310000354707us-gaap:FairValueMeasurementsRecurringMemberus-gaap:MortgageBackedSecuritiesIssuedByUSGovernmentSponsoredEnterprisesMemberus-gaap:FairValueInputsLevel2Memberhe:BankingSegmentMember2021-12-310000354707us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel3Memberus-gaap:MortgageBackedSecuritiesIssuedByUSGovernmentSponsoredEnterprisesMemberhe:BankingSegmentMember2021-12-310000354707us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel1Memberhe:BankingSegmentMemberus-gaap:USGovernmentAgenciesDebtSecuritiesMember2022-03-310000354707us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel2Memberhe:BankingSegmentMemberus-gaap:USGovernmentAgenciesDebtSecuritiesMember2022-03-310000354707us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel3Memberhe:BankingSegmentMemberus-gaap:USGovernmentAgenciesDebtSecuritiesMember2022-03-310000354707us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel1Memberhe:BankingSegmentMemberus-gaap:USGovernmentAgenciesDebtSecuritiesMember2021-12-310000354707us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel2Memberhe:BankingSegmentMemberus-gaap:USGovernmentAgenciesDebtSecuritiesMember2021-12-310000354707us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel3Memberhe:BankingSegmentMemberus-gaap:USGovernmentAgenciesDebtSecuritiesMember2021-12-310000354707us-gaap:CorporateBondSecuritiesMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel1Memberhe:BankingSegmentMember2022-03-310000354707us-gaap:CorporateBondSecuritiesMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel2Memberhe:BankingSegmentMember2022-03-310000354707us-gaap:CorporateBondSecuritiesMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel3Memberhe:BankingSegmentMember2022-03-310000354707us-gaap:CorporateBondSecuritiesMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel1Memberhe:BankingSegmentMember2021-12-310000354707us-gaap:CorporateBondSecuritiesMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel2Memberhe:BankingSegmentMember2021-12-310000354707us-gaap:CorporateBondSecuritiesMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel3Memberhe:BankingSegmentMember2021-12-310000354707us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel1Memberhe:BankingSegmentMemberus-gaap:AssetBackedSecuritiesMember2022-03-310000354707us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel2Memberhe:BankingSegmentMemberus-gaap:AssetBackedSecuritiesMember2022-03-310000354707us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel3Memberhe:BankingSegmentMemberus-gaap:AssetBackedSecuritiesMember2022-03-310000354707us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel1Memberhe:BankingSegmentMemberus-gaap:AssetBackedSecuritiesMember2021-12-310000354707us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel2Memberhe:BankingSegmentMemberus-gaap:AssetBackedSecuritiesMember2021-12-310000354707us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel3Memberhe:BankingSegmentMemberus-gaap:AssetBackedSecuritiesMember2021-12-310000354707us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel1Memberhe:BankingSegmentMember2022-03-310000354707us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel2Memberhe:BankingSegmentMember2022-03-310000354707us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel3Memberhe:BankingSegmentMember2022-03-310000354707us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel1Memberhe:BankingSegmentMember2021-12-310000354707us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel2Memberhe:BankingSegmentMember2021-12-310000354707us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel3Memberhe:BankingSegmentMember2021-12-310000354707us-gaap:InterestRateLockCommitmentsMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel1Memberhe:BankingSegmentMember2022-03-310000354707us-gaap:InterestRateLockCommitmentsMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel2Memberhe:BankingSegmentMember2022-03-310000354707us-gaap:InterestRateLockCommitmentsMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel3Memberhe:BankingSegmentMember2022-03-310000354707us-gaap:InterestRateLockCommitmentsMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel1Memberhe:BankingSegmentMember2021-12-310000354707us-gaap:InterestRateLockCommitmentsMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel2Memberhe:BankingSegmentMember2021-12-310000354707us-gaap:InterestRateLockCommitmentsMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel3Memberhe:BankingSegmentMember2021-12-310000354707us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel1Memberus-gaap:ForwardContractsMemberhe:BankingSegmentMember2022-03-310000354707us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel2Memberus-gaap:ForwardContractsMemberhe:BankingSegmentMember2022-03-310000354707us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel3Memberus-gaap:ForwardContractsMemberhe:BankingSegmentMember2022-03-310000354707us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel1Memberus-gaap:ForwardContractsMemberhe:BankingSegmentMember2021-12-310000354707us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel2Memberus-gaap:ForwardContractsMemberhe:BankingSegmentMember2021-12-310000354707us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel3Memberus-gaap:ForwardContractsMemberhe:BankingSegmentMember2021-12-310000354707us-gaap:InterestRateSwapMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel1Memberus-gaap:AllOtherSegmentsMember2022-03-310000354707us-gaap:InterestRateSwapMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel2Memberus-gaap:AllOtherSegmentsMember2022-03-310000354707us-gaap:InterestRateSwapMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel3Memberus-gaap:AllOtherSegmentsMember2022-03-310000354707us-gaap:InterestRateSwapMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel1Memberus-gaap:AllOtherSegmentsMember2021-12-310000354707us-gaap:InterestRateSwapMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel2Memberus-gaap:AllOtherSegmentsMember2021-12-310000354707us-gaap:InterestRateSwapMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel3Memberus-gaap:AllOtherSegmentsMember2021-12-310000354707us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel1Member2022-03-310000354707us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel2Member2022-03-310000354707us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel3Member2022-03-310000354707us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel1Member2021-12-310000354707us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel2Member2021-12-310000354707us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel3Member2021-12-310000354707us-gaap:AssetBackedSecuritiesMember2021-12-310000354707us-gaap:AssetBackedSecuritiesMember2020-12-310000354707us-gaap:AssetBackedSecuritiesMember2022-01-012022-03-310000354707us-gaap:AssetBackedSecuritiesMember2021-01-012021-03-310000354707us-gaap:AssetBackedSecuritiesMember2022-03-310000354707us-gaap:AssetBackedSecuritiesMember2021-03-310000354707us-gaap:MeasurementInputDiscountRateMember2022-03-310000354707he:AmericanSavingsBankFSBMemberus-gaap:FairValueMeasurementsNonrecurringMember2021-01-012021-03-310000354707he:AmericanSavingsBankFSBMemberus-gaap:FairValueMeasurementsNonrecurringMember2022-01-012022-03-31

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
 FORM 10-Q
 
☒      QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2022
 OR
     ☐         TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Exact Name of Registrant as Specified in Its CharterCommission File NumberI.R.S. Employer Identification No.
HAWAIIAN ELECTRIC INDUSTRIES, INC. 1-8503 99-0208097
and Principal Subsidiary
HAWAIIAN ELECTRIC COMPANY, INC. 1-4955 99-0040500
State of Hawaii
(State or other jurisdiction of incorporation or organization)
 
Hawaiian Electric Industries, Inc. – 1001 Bishop Street, Suite 2900, Honolulu, Hawaii  96813
Hawaiian Electric Company, Inc. – 1001 Bishop Street, Suite, 2500, Honolulu, Hawaii  96813
(Address of principal executive offices and zip code)
 
Hawaiian Electric Industries, Inc. – (808) 543-5662
Hawaiian Electric Company, Inc. – (808) 543-7771
(Registrant’s telephone number, including area code) 
Not applicable
(Former name, former address and former fiscal year, if changed since last report)
RegistrantTitle of each classTrading Symbol(s)Name of each exchange on which registered
Hawaiian Electric Industries, Inc. Common Stock, Without Par ValueHENew York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Hawaiian Electric Industries, Inc.Yes☒No☐ Hawaiian Electric Company, Inc. Yes☒No☐
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
Hawaiian Electric Industries, Inc.Yes☒No☐ Hawaiian Electric Company, Inc.Yes☒No☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Securities Exchange Act of 1934.
Hawaiian Electric Industries, Inc.: Hawaiian Electric Company, Inc.:
Large accelerated filer☒Smaller reporting company☐Large accelerated filer☐Smaller reporting company☐
Accelerated filer☐Emerging growth company☐Accelerated filer☐Emerging growth company☐
Non-accelerated filer☐Non-accelerated filer☒
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Hawaiian Electric Industries, Inc.☐Hawaiian Electric Company, Inc.☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Hawaiian Electric Industries, Inc.Yes☐No☒Hawaiian Electric Company, Inc.Yes☐No☒
Securities registered pursuant to 12(b) of the Act:
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuers’ classes of common stock, as of the latest practicable date.
Class of Common Stock 
Outstanding April 25, 2022
Hawaiian Electric Industries, Inc. (Without Par Value) 109,431,346 Shares
Hawaiian Electric Company, Inc. ($6-2/3 Par Value) 17,753,533 Shares (not publicly traded)
Hawaiian Electric Industries, Inc. (HEI) is the sole holder of Hawaiian Electric Company, Inc. (Hawaiian Electric) common stock.
This combined Form 10-Q is separately filed by HEI and Hawaiian Electric. Information contained herein relating to any individual registrant is filed by such registrant on its own behalf. No registrant makes any representation as to information relating to the other registrant, except that information relating to Hawaiian Electric is also attributed to HEI.


Hawaiian Electric Industries, Inc. and Subsidiaries
Hawaiian Electric Company, Inc. and Subsidiaries
Form 10-Q—Quarter ended March 31, 2022
 
TABLE OF CONTENTS
 
Page No. 
  
 
  
 
three months ended March 31, 2022 and 2021
 
three months ended March 31, 2022 and 2021
 
 
three months ended March 31, 2022 and 2021
 
three months ended March 31, 2022 and 2021
  
 
three months ended March 31, 2022 and 2021
 
three months ended March 31, 2022 and 2021
 
 
three months ended March 31, 2022 and 2021
 
three months ended March 31, 2022 and 2021
 
 
 
 
  
 
 
i

Hawaiian Electric Industries, Inc. and Subsidiaries
Hawaiian Electric Company, Inc. and Subsidiaries
Form 10-Q—Quarter ended March 31, 2022
GLOSSARY OF TERMS
Terms Definitions
ACLAllowance for credit losses, which is the current credit loss standard, requires recording the allowance based on the expected loss model
AES HawaiiAES Hawaii, Inc.
AOCIAccumulated other comprehensive income/(loss)
ARAAnnual revenue adjustment
ASBAmerican Savings Bank, F.S.B., a wholly owned subsidiary of ASB Hawaii, Inc.
ASB HawaiiASB Hawaii, Inc., a wholly owned subsidiary of Hawaiian Electric Industries, Inc. and the parent company of American Savings Bank, F.S.B.
ASUAccounting Standards Update
CARES ActThe Coronavirus Aid, Relief, and Economic Security Act enacted March 27, 2020
CBRECommunity-based renewable energy
CompanyHawaiian Electric Industries, Inc. and its direct and indirect subsidiaries, including, without limitation, Hawaiian Electric Company, Inc. and its subsidiaries (listed under Hawaiian Electric); ASB Hawaii, Inc. and its subsidiary, American Savings Bank, F.S.B. and Pacific Current, LLC and its subsidiaries (listed under Pacific Current). The Old Oahu Tug Service, Inc. was dissolved in March 2022.
Consumer AdvocateDivision of Consumer Advocacy, Department of Commerce and Consumer Affairs of the State of Hawaii
D&ODecision and order from the PUC
Dodd-Frank ActDodd-Frank Wall Street Reform and Consumer Protection Act of 2010
DOHDepartment of Health of the State of Hawaii
DRIPHEI Dividend Reinvestment and Stock Purchase Plan
ECRCEnergy cost recovery clause
EIP2010 Equity and Incentive Plan, as amended and restated
EPAEnvironmental Protection Agency — federal
EPRMExceptional Project Recovery Mechanism
EPSEarnings per share
ERP/EAMEnterprise Resource Planning/Enterprise Asset Management
ESGEnvironmental, Social & Governance
ESMEarnings Sharing Mechanism
EVEEconomic value of equity
Exchange ActSecurities Exchange Act of 1934
FASBFinancial Accounting Standards Board
FDICFederal Deposit Insurance Corporation
federalU.S. Government
FHLBFederal Home Loan Bank
FHLMCFederal Home Loan Mortgage Corporation
FitchFitch Ratings, Inc.
FNMAFederal National Mortgage Association
FRBFederal Reserve Board
GAAPAccounting principles generally accepted in the United States of America
GHGGreenhouse gas
GNMAGovernment National Mortgage Association
GSPAGrid Services Purchase Agreement
Hamakua EnergyHamakua Energy, LLC, an indirect subsidiary of Pacific Current
Hawaii Electric LightHawaii Electric Light Company, Inc., an electric utility subsidiary of Hawaiian Electric Company, Inc.

ii
GLOSSARY OF TERMS, continued
Terms Definitions
Hawaiian ElectricHawaiian Electric Company, Inc., an electric utility subsidiary of Hawaiian Electric Industries, Inc. and parent company of Hawaii Electric Light Company, Inc., Maui Electric Company, Limited and Renewable Hawaii, Inc.
HEIHawaiian Electric Industries, Inc., direct parent company of Hawaiian Electric Company, Inc., ASB Hawaii, Inc. and Pacific Current, LLC. The Old Oahu Tug Service, Inc. was dissolved in March 2022.
HEIRSPHawaiian Electric Industries Retirement Savings Plan
HELOCHome equity line of credit
HPOWERCity and County of Honolulu with respect to a power purchase agreement for a refuse-fired plant
IPPIndependent power producer
IRLCsInterest rate lock commitments
KalaeloaKalaeloa Partners, L.P.
kWhKilowatthour/s (as applicable)
LMILow-to-moderate income
LTIPLong-term incentive plan
Maui ElectricMaui Electric Company, Limited, an electric utility subsidiary of Hawaiian Electric Company, Inc.
MauoMauo, LLC, a subsidiary of Pacific Current
Moody’sMoody’s Investors Service’s
MPIRMajor Project Interim Recovery
MSRsMortgage servicing rights
MWMegawatt/s (as applicable)
MRPMulti-year rate period
NIINet interest income
NPBCNet periodic benefit costs
NPPCNet periodic pension costs
O&MOther operation and maintenance
OCCOffice of the Comptroller of the Currency
OPEBPostretirement benefits other than pensions
Pacific Current
Pacific Current, LLC, a wholly owned subsidiary of HEI and parent company of Hamakua Holdings, LLC, Mauo, LLC, Alenuihaha Developments, LLC, Kaʻieʻie Waho Company, LLC, Kaʻaipuaʻa, LLC, Upena, LLC and Mahipapa, LLC
PBRPerformance-based regulation
PGVPuna Geothermal Venture
PIMsPerformance incentive mechanisms
PPAPower purchase agreement
PPACPurchased power adjustment clause
PUCPublic Utilities Commission of the State of Hawaii
PVPhotovoltaic
RAMRevenue adjustment mechanism
RBARevenue balancing account
REIPRenewable Energy Infrastructure Program
RFPRequest for proposals
ROACEReturn on average common equity
RORBReturn on rate base
RPSRenewable portfolio standards
S&PS&P Global Ratings
SBASmall Business Administration
SECSecurities and Exchange Commission
SeeMeans the referenced material is incorporated by reference
Tax Act
2017 Tax Cuts and Jobs Act (H.R. 1, An Act to provide for reconciliation pursuant to titles II and V of the concurrent resolution on the budget for fiscal year 2018)
TDRTroubled debt restructuring
UtilitiesHawaiian Electric Company, Inc., Hawaii Electric Light Company, Inc. and Maui Electric Company, Limited
VIEsVariable interest entities
iii

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This report and other presentations made by Hawaiian Electric Industries, Inc. (HEI) and Hawaiian Electric Company, Inc. (Hawaiian Electric) and their subsidiaries contain “forward-looking statements,” which include statements that are predictive in nature, depend upon or refer to future events or conditions and usually include words such as “will,” “expects,” “anticipates,” “intends,” “plans,” “believes,” “predicts,” “estimates” or similar expressions. In addition, any statements concerning future financial performance, ongoing business strategies or prospects or possible future actions are also forward-looking statements. Forward-looking statements are based on current expectations and projections about future events and are subject to risks, uncertainties and the accuracy of assumptions concerning HEI and its subsidiaries (collectively, the Company), the performance of the industries in which they do business and economic, political and market factors, among other things. These forward-looking statements are not guarantees of future performance and actual results and financial condition may differ materially from those indicated in the forward-looking statements.
Risks, uncertainties and other important factors that could cause actual results to differ materially from those described in forward-looking statements and from historical results include, but are not limited to, the following:
•international, national and local economic and political conditions—including the state of the Hawaii tourism, defense and construction industries; the strength or weakness of the Hawaii and continental U.S. real estate markets (including the fair value and/or the actual performance of collateral underlying loans held by ASB, which could result in higher loan loss provisions and write-offs); decisions concerning the extent of the presence of the federal government and military in Hawaii; the implications and potential impacts of future Federal government shutdowns, including the impact to our customers’ ability to pay their electric bills and/or bank loans and the impact on the state of Hawaii economy; the implications and potential impacts of U.S. and foreign capital and credit market conditions and federal, state and international responses to those conditions; the potential impacts of global and local developments (including global economic conditions and uncertainties, unrest, terrorist acts, wars (such as the Russia-Ukraine war), conflicts, political protests, deadly virus epidemic or other crisis); the effects of changes that have or may occur in U.S. policy, such as with respect to immigration and trade; and pandemics;
•the extent of the impact of the COVID-19 pandemic, including the duration, spread, severity and any recurrence of the COVID-19 pandemic due to new variants or insufficient vaccinations, the duration and scope of related government orders and restrictions, the impact on our employees, customers and suppliers, and the impact of the COVID-19 pandemic on the overall demand or ability to pay for the Company’s goods and services, all of which could be affected by the pace of distribution, administration, and efficacy of COVID-19 vaccines over the short- and long-term, as well as the proportion of the population vaccinated;
•ability to adequately address risks and capitalize on opportunities related to our environmental, social and governance (ESG) priority areas, which currently include decarbonization, economic health and affordability, reliability and resilience, secure digitalization, diversity, equity and inclusion, employee engagement, and climate-related risks and opportunities;
•citizen activism, including civil unrest, especially in times of severe economic depression and social divisiveness, which could negatively impact customers and employees, impair the ability of the Company and the Utilities to operate and maintain their facilities in an effective and safe manner, and citizen or stakeholder activism that could delay the construction, increase project costs or preclude the completion, of third-party or Utility projects that are required to meet electricity demand, resilience and reliability objectives and renewable portfolio standards (RPS) and other climate-related goals;
•the effects of future actions or inaction of the U.S. government or related agencies, including those related to the U.S. debt ceiling or budget funding, monetary policy, trade policy and tariffs, energy and environmental policy, and other policy and regulatory changes advanced or proposed by President Biden and his administration;
•weather, natural disasters (e.g., hurricanes, earthquakes, tsunamis, lightning strikes, lava flows and the increasing effects of climate change, such as more severe storms, flooding, droughts, heat waves, and rising sea levels) and wildfires, including their impact on the resilience and reliability and cost of the Company’s and Utilities’ operations and the economy;
•the timing, speed and extent of changes in interest rates and the shape of the yield curve, which could result in lower portfolio yields and net interest margin, or higher borrowing costs;
•the ability of the Company and the Utilities to access the credit and capital markets (e.g., to obtain commercial paper and other short-term and long-term debt financing, including lines of credit, and, in the case of HEI, to issue common stock) under volatile and challenging market conditions, and the potential higher cost of such financings, if available;
•the risks inherent in changes in the value of the Company’s pension and other retirement plan assets and ASB’s securities available for sale, and the risks inherent in changes in the value of the Company’s pension liabilities, including changes driven by interest rates and mortality improvements;
•changes in laws, regulations (including tax regulations), market conditions, interest rates and other factors that result in changes in assumptions used to calculate retirement benefits costs and funding requirements;
•increasing competition in the banking industry from traditional financial institutions as well as from non-traditional providers of financial services, including financial service subsidiaries of commercial and manufacturing companies (e.g., increased price competition for loans and deposits, or an outflow of deposits to alternative investments or platforms, which may have an adverse impact on ASB’s net interest margin and portfolio growth);
iv

•the potential delay by the Public Utilities Commission of the State of Hawaii (PUC) in considering (and potential disapproval of actual or proposed) renewable energy proposals and related costs; reliance by the Utilities on outside parties such as the state, independent power producers (IPPs) and developers; supply-chain challenges; and uncertainties surrounding technologies, solar power, wind power, biofuels, environmental assessments required to meet RPS and other climate-related goals; the impacts of implementation of the renewable energy proposals on future costs of electricity and potential penalties imposed by the PUC for delays in the commercial operations of renewable energy projects;
•the ability of the Utilities to develop, implement and recover the costs of implementing the Utilities’ action plans included in their updated Power Supply Improvement Plans, Demand Response Portfolio Plan, Distributed Generation Interconnection Plan, Grid Modernization Plans, and business model changes, which have been and are continuing to be developed and updated in response to the orders issued by the PUC, the PUC’s April 2014 statement of its inclinations on the future of Hawaii’s electric utilities and the vision, business strategies and regulatory policy changes required to align the Utilities’ business model with customer interests and the state’s public policy goals, and subsequent orders of the PUC;
•the ability of the Utilities to recover undepreciated cost of fossil fuel generating units, if they are required to be retired before the end of their expected useful life;
•capacity and supply constraints or difficulties, especially if generating units (utility-owned or IPP-owned) fail or measures such as demand-side management, distributed generation, combined heat and power or other firm capacity supply-side resources fall short of achieving their forecasted benefits or are otherwise insufficient to reduce or meet peak demand;
•high and/or volatile fuel prices, which increases working capital requirements and customer bills, or delivery of adequate fuel by suppliers (including as a result of the Russia-Ukraine war), which could affect the reliability of utility operations, and the continued availability to the electric utilities of their energy cost recovery clauses (ECRCs);
•the continued availability to the electric utilities or modifications of other cost recovery mechanisms, including the purchased power adjustment clauses (PPACs), annual revenue adjustment (ARA) and pension and postretirement benefits other than pensions (OPEB) tracking mechanisms, and the continued decoupling of revenues from sales to mitigate the effects of declining kilowatt-hour sales;
•the ability of the Utilities to recover increasing costs and earn a reasonable return on capital investments not covered by the annual revenue adjustment (ARA), while providing the customer dividend required by performance-based regulation (PBR);
•the ability of the Utilities to achieve performance incentive goals currently in place;
•the impact from the PUC’s implementation of PBR for the Utilities pursuant to Act 005, Session Laws 2018, including the potential addition of new performance incentive mechanisms (PIMs), third-party proposals adopted by the PUC in its implementation of PBR, and the implications of not achieving performance incentive goals;
•the impact of fuel price levels and volatility on customer satisfaction and political and regulatory support for the Utilities;
•the risks associated with increasing reliance on renewable energy, including the availability and cost of non-fossil fuel supplies for renewable energy generation and the operational impacts of adding intermittent sources of renewable energy to the electric grid;
•the growing risk that energy production from renewable generating resources may be curtailed and the interconnection of additional resources will be constrained as more generating resources are added to the Utilities’ electric systems and as customers reduce their energy usage;
•the ability of IPPs to deliver the firm capacity anticipated in their power purchase agreements (PPAs);
•the potential that, as IPP contracts near the end of their terms, there may be less economic incentive for the IPPs to make investments in their units to ensure the availability of their units;
•the ability of the Utilities to negotiate, periodically, favorable agreements for significant resources such as fuel supply contracts and collective bargaining agreements and avoid or mitigate labor disputes and work stoppages;
•new technological developments that could affect the operations and prospects of the Utilities and ASB or their competitors such as the commercial development of energy storage and microgrids and banking through alternative channels, including use of digital currencies, which could include a central bank digital currency;
•cybersecurity risks and the potential for cyber incidents, including potential incidents at HEI, its third-party vendors, and its subsidiaries (including at ASB branches, electric utility plants and IPP-owned facilities) and incidents at data processing centers used, to the extent not prevented by intrusion detection and prevention systems, anti-virus software, firewalls and other general IT controls;
•failure to achieve remaining cost savings commitment related to the management audit committed savings of $33 million over the 2021 to 2025 multi-year rate period (MRP);
•federal, state, county and international governmental and regulatory actions, such as existing, new and changes in laws, rules and regulations applicable to HEI, the Utilities and ASB (including changes in taxation and tax rates, increases in capital requirements, regulatory policy changes, environmental laws and regulations (including resulting compliance costs and risks of fines and penalties and/or liabilities), the regulation of greenhouse gas emissions, governmental fees and assessments (such as Federal Deposit Insurance Corporation assessments), and potential carbon pricing or “cap and trade” legislation that may fundamentally alter costs to produce electricity and accelerate the move to renewable generation);
v

•developments in laws, regulations and policies governing protections for historic, archaeological and cultural sites, and plant and animal species and habitats, as well as developments in the implementation and enforcement of such laws, regulations and policies;
•discovery of conditions that may be attributable to historical chemical releases, including any necessary investigation and remediation, and any associated enforcement, litigation or regulatory oversight;
•decisions by the PUC in rate cases and other proceedings (including the risks of delays in the timing of decisions, adverse changes in final decisions from interim decisions and the disallowance of project costs as a result of adverse regulatory audit reports or otherwise);
•decisions by the PUC and by other agencies and courts on land use, environmental and other permitting issues (such as required corrective actions, restrictions and penalties that may arise, such as with respect to environmental conditions or RPS);
•potential enforcement actions by the Office of the Comptroller of the Currency (OCC), the Federal Reserve Board (FRB), the Federal Deposit Insurance Corporation (FDIC) and/or other governmental authorities (such as consent orders, required corrective actions, restrictions and penalties that may arise, for example, with respect to compliance deficiencies under existing or new banking and consumer protection laws and regulations or with respect to capital adequacy);
•the risks associated with the geographic concentration of HEI’s businesses and ASB’s loans, ASB’s concentration in a single product type (i.e., first mortgages) and ASB’s significant credit relationships (i.e., concentrations of large loans and/or credit lines with certain customers);
•changes in accounting principles applicable to HEI and its subsidiaries, including the adoption of new U.S. accounting standards, the potential discontinuance of regulatory accounting related to PBR or other regulatory changes, the effects of potentially required consolidation of variable interest entities (VIEs), or required finance lease or on-balance-sheet operating lease accounting for PPAs with IPPs;
•downgrades by securities rating agencies in their ratings of the securities of HEI and Hawaiian Electric and their impact on results of financing efforts;
•faster than expected loan prepayments that can cause a decrease in net interest income and portfolio yields, an acceleration of the amortization of premiums on loans and investments and the impairment of mortgage-servicing assets of ASB;
•changes in ASB’s loan portfolio credit profile and asset quality and/or mix, which may increase or decrease the required level of provision for credit losses, allowance for credit losses (ACL) and charge-offs;
•changes in ASB’s deposit cost or mix which may have an adverse impact on ASB’s cost of funds;
•unanticipated changes from the expected discontinuance of LIBOR and the transition to an alternative reference rate, which may include adverse impacts to the Company’s cost of capital, loan portfolio and interest income on loans;
•the final outcome of tax positions taken by HEI and its subsidiaries;
•the risks of suffering losses and incurring liabilities that are uninsured (e.g., damages to the Utilities’ transmission and distribution system and losses from business interruption) or underinsured (e.g., losses not covered as a result of insurance deductibles or other exclusions or exceeding policy limits), and the risks associated with the operation of transmission and distribution assets and power generation facilities, including public and employee safety issues, and assets causing or contributing to wildfires;
•the ability of the Company’s non-regulated subsidiary, Pacific Current, LLC (Pacific Current), to achieve its performance and growth objectives, which in turn could affect its ability to service its non-recourse debt;
•the Company’s reliance on third parties and the risk of their non-performance, which has increased due to the impact from the COVID-19 pandemic; and
•other risks or uncertainties described elsewhere in this report and in other reports (e.g., “Item 1A. Risk Factors” in the Company’s Annual Report on Form 10-K) previously and subsequently filed by HEI and/or Hawaiian Electric with the Securities and Exchange Commission.
Forward-looking statements speak only as of the date of the report, presentation or filing in which they are made. Except to the extent required by the federal securities laws, HEI, Hawaiian Electric, ASB, Pacific Current and their subsidiaries undertake no obligation to publicly update or revise any forward-looking statements, whether written or oral and whether as a result of new information, future events or otherwise.
vi

PART I - FINANCIAL INFORMATION

Item 1.  Financial Statements

Hawaiian Electric Industries, Inc. and Subsidiaries
Condensed Consolidated Statements of Income (unaudited)
Three months ended March 31
(in thousands, except per share amounts)20222021
Revenues  
Electric utility$708,792 $564,864 
Bank75,115 77,131 
Other1,161 951 
Total revenues785,068 642,946 
Expenses  
Electric utility635,197 495,750 
Bank45,085 41,835 
Other5,510 7,330 
Total expenses685,792 544,915 
Operating income (loss)  
Electric utility73,595 69,114 
Bank30,030 35,296 
Other(4,349)(6,379)
Total operating income99,276 98,031 
Retirement defined benefits credit—other than service costs1,243 2,435 
Interest expense, net—other than on deposit liabilities and other bank borrowings
(24,349)(23,736)
Allowance for borrowed funds used during construction778 747 
Allowance for equity funds used during construction2,409 2,191 
Gain on sales of investment securities, net and equity-method investment8,123 528 
Income before income taxes87,480 80,196 
Income taxes17,840 15,365 
Net income69,640 64,831 
Preferred stock dividends of subsidiaries473 473 
Net income for common stock$69,167 $64,358 
Basic earnings per common share$0.63 $0.59 
Diluted earnings per common share$0.63 $0.59 
Weighted-average number of common shares outstanding109,361 109,221 
Net effect of potentially dilutive shares273 271 
Weighted-average shares assuming dilution109,634 109,492 
This report should be read in conjunction with the Notes herein and the Notes to Consolidated Financial Statements appearing in the 2021 Form 10-K.

1

Hawaiian Electric Industries, Inc. and Subsidiaries
Condensed Consolidated Statements of Comprehensive Income (unaudited)
 Three months ended March 31
(in thousands)20222021
Net income for common stock$69,167 $64,358 
Other comprehensive income (loss), net of taxes:  
Net unrealized gains (losses) on available-for-sale investment securities:  
Net unrealized losses on available-for-sale investment securities arising during the period, net of taxes of $(44,079) and $(16,616), respectively
(120,407)(45,390)
Reclassification adjustment for net realized gains included in net income, net of taxes of $— and $(142), respectively
— (387)
Derivatives qualifying as cash flow hedges:  
Unrealized interest rate hedging gains arising during the period, net of taxes of $1,046 and $542, respectively
3,017 1,562 
Reclassification adjustment for net realized losses included in net income, net of taxes of $19 and nil, respectively
55 — 
Retirement benefit plans:  
Adjustment for amortization of prior service credit and net losses recognized during the period in net periodic benefit cost, net of taxes of $1,562 and $2,084, respectively
4,501 6,010 
Reclassification adjustment for impact of D&Os of the PUC included in regulatory assets, net of taxes of $(1,500) and $(2,015), respectively
(4,325)(5,811)
Other comprehensive loss, net of tax benefits(117,159)(44,016)
Comprehensive income (loss) attributable to Hawaiian Electric Industries, Inc.$(47,992)$20,342 
This report should be read in conjunction with the Notes herein and the Notes to Consolidated Financial Statements appearing in the 2021 Form 10-K.

2

Hawaiian Electric Industries, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets (unaudited) 
(dollars in thousands)March 31, 2022December 31, 2021
Assets  
Cash and cash equivalents$301,704 $305,551 
Restricted cash5,912 5,911 
Accounts receivable and unbilled revenues, net359,807 344,213 
Available-for-sale investment securities, at fair value2,621,375 2,574,618 
Held-to-maturity investment securities, at amortized cost517,150 522,270 
Stock in Federal Home Loan Bank, at cost10,000 10,000 
Loans held for investment, net5,117,522 5,139,984 
Loans held for sale, at lower of cost or fair value7,961 10,404 
Property, plant and equipment, net of accumulated depreciation of $3,077,453 and $3,028,130 at March 31, 2022 and December 31, 2021, respectively
5,411,746 5,392,068 
Operating lease right-of-use assets136,207 122,416 
Regulatory assets559,161 565,543 
Other777,694 747,469 
Goodwill82,190 82,190 
Total assets$15,908,429 $15,822,637 
Liabilities and shareholders’ equity  
Liabilities  
Accounts payable$240,296 $205,544 
Interest and dividends payable33,519 19,889 
Deposit liabilities8,289,272 8,172,212 
Short-term borrowings—other than bank71,491 53,998 
Other bank borrowings137,385 88,305 
Long-term debt, net—other than bank2,316,046 2,321,937 
Deferred income taxes340,246 384,760 
Operating lease liabilities151,832 136,760 
Regulatory liabilities1,003,444 996,768 
Defined benefit pension and other postretirement benefit plans liability341,845 348,072 
Other645,118 669,215 
Total liabilities13,570,494 13,397,460 
Preferred stock of subsidiaries - not subject to mandatory redemption34,293 34,293 
Commitments and contingencies (Notes 3 and 4)
Shareholders’ equity  
Preferred stock, no par value, authorized 10,000,000 shares; issued: none
— — 
Common stock, no par value, authorized 200,000,000 shares; issued and outstanding: 109,431,346 shares and 109,311,785 shares at March 31, 2022 and December 31, 2021, respectively
1,684,547 1,685,496 
Retained earnings788,787 757,921 
Accumulated other comprehensive loss, net of tax benefits(169,692)(52,533)
Total shareholders’ equity2,303,642 2,390,884 
Total liabilities and shareholders’ equity$15,908,429 $15,822,637 
This report should be read in conjunction with the Notes herein and the Notes to Consolidated Financial Statements appearing in the 2021 Form 10-K.

3

Hawaiian Electric Industries, Inc. and Subsidiaries
Condensed Consolidated Statements of Changes in Shareholders’ Equity (unaudited) 
 Common stockRetainedAccumulated
other
comprehensive		 
(in thousands)SharesAmountEarningsincome (loss)Total
Balance, December 31, 2021109,312 $1,685,496 $757,921 $(52,533)$2,390,884 
Net income for common stock— — 69,167 — 69,167 
Other comprehensive loss, net of tax benefits— — — (117,159)(117,159)
Share-based expenses and other, net119 (949)— — (949)
Common stock dividends (35¢ per share)
— — (38,301)— (38,301)
Balance, March 31, 2022109,431 $1,684,547 $788,787 $(169,692)$2,303,642 
Balance, December 31, 2020109,181 $1,678,368 $660,398 $(1,264)$2,337,502 
Net income for common stock— — 64,358 — 64,358 
Other comprehensive income, net of taxes— — — (44,016)(44,016)
Share-based expenses and other, net100 605 — — 605 
Common stock dividends (34¢ per share)
— — (37,156)— (37,156)
Balance, March 31, 2021109,281 $1,678,973 $687,600 $(45,280)$2,321,293 
This report should be read in conjunction with the Notes herein and the Notes to Consolidated Financial Statements appearing in the 2021 Form 10-K.

4

Hawaiian Electric Industries, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows (unaudited)
Three months ended March 31
(in thousands)20222021
Cash flows from operating activities  
Net income$69,640 $64,831 
Adjustments to reconcile net income to net cash provided by operating activities  
Depreciation of property, plant and equipment62,990 61,427 
Other amortization9,425 10,951 
Provision for credit losses(3,263)(8,435)
Loans originated, held for sale(73,931)(162,901)
Proceeds from sale of loans, held for sale75,629 170,862 
Gain on sales of investment securities, net and equity-method investment(8,123)(528)
Gain on sale of loans, net(1,077)(4,300)
Deferred income taxes(5,255)(2,196)
Share-based compensation expense2,117 2,602 
Allowance for equity funds used during construction(2,409)(2,191)
Other(2,552)(3,519)
Changes in assets and liabilities  
Decrease in accounts receivable and unbilled revenues, net4,454 5,664 
Increase in fuel oil stock(35,333)(16,400)
Increase in regulatory assets(5,089)(14,869)
Increase (decrease) in regulatory liabilities5,520 (4,716)
Increase in accounts, interest and dividends payable71,490 7,677 
Change in prepaid and accrued income taxes, tax credits and utility revenue taxes(14,928)(25,513)
Decrease in defined benefit pension and other postretirement benefit plans liability(1,309)(2,621)
Change in other assets and liabilities(55,411)(34,095)
Net cash provided by operating activities92,585 41,730 
Cash flows from investing activities  
Available-for-sale investment securities purchased(291,168)(781,992)
Principal repayments on available-for-sale investment securities104,654 184,755 
Proceeds from sale of available-for-sale investment securities— 197,354 
Purchases of held-to-maturity investment securities— (88,262)
Proceeds from repayments or maturities of held-to-maturity investment securities4,547 20,185 
Purchase of stock from Federal Home Loan Bank — (22,296)
Redemption of stock from Federal Home Loan Bank— 20,976 
Net decrease in loans held for investment28,076 23,922 
Capital expenditures(79,163)(74,079)
Contributions to low income housing investments— (3,205)
Other5,340 4,622 
Net cash used in investing activities(227,714)(518,020)
(continued)

5

Hawaiian Electric Industries, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows (unaudited) (continued)
Three months ended March 31
(in thousands)20222021
Cash flows from financing activities  
Net increase in deposit liabilities117,060 358,337 
Net increase in short-term borrowings with original maturities of three months or less17,493 35,751 
Net increase in other bank borrowings with original maturities of three months or less49,080 13,015 
Repayment of short-term debt— (65,000)
Proceeds from issuance of long-term debt7,312 161,800 
Repayment of long-term debt(13,446)(50,699)
Withheld shares for employee taxes on vested share-based compensation(3,065)(1,997)
Common stock dividends(38,301)(37,156)
Preferred stock dividends of subsidiaries(473)(473)
Other(4,377)(4,621)
Net cash provided by financing activities131,283 408,957 
Net decrease in cash, cash equivalents and restricted cash(3,846)(67,333)
Cash, cash equivalents and restricted cash, beginning of period311,462 358,979 
Cash, cash equivalents and restricted cash, end of period307,616 291,646 
Less: Restricted cash(5,912)(14,067)
Cash and cash equivalents, end of period$301,704 $277,579 
This report should be read in conjunction with the Notes herein and the Notes to Consolidated Financial Statements appearing in the 2021 Form 10-K.
6

Hawaiian Electric Company, Inc. and Subsidiaries
Condensed Consolidated Statements of Income (unaudited)
Three months ended March 31
(in thousands)20222021
Revenues$708,792 $564,864 
Expenses  
Fuel oil221,286 127,427 
Purchased power163,533 142,296 
Other operation and maintenance125,257 114,570 
Depreciation58,471 57,355 
Taxes, other than income taxes66,650 54,102 
Total expenses635,197 495,750 
Operating income73,595 69,114 
Allowance for equity funds used during construction2,409 2,191 
Retirement defined benefits credit —other than service costs990 1,021 
Interest expense and other charges, net(18,326)(17,983)
Allowance for borrowed funds used during construction778 747 
Income before income taxes59,446 55,090 
Income taxes12,538 11,233 
Net income46,908 43,857 
Preferred stock dividends of subsidiaries229 229 
Net income attributable to Hawaiian Electric46,679 43,628 
Preferred stock dividends of Hawaiian Electric270 270 
Net income for common stock$46,409 $43,358 
This report should be read in conjunction with the Notes herein and the Notes to Consolidated Financial Statements appearing in the 2021 Form 10-K.
HEI owns all of the common stock of Hawaiian Electric. Therefore, per share data with respect to shares of common stock of Hawaiian Electric are not meaningful.

Hawaiian Electric Company, Inc. and Subsidiaries
Condensed Consolidated Statements of Comprehensive Income (unaudited)
 Three months ended March 31
(in thousands)20222021
Net income for common stock$46,409 $43,358 
Other comprehensive income, net of taxes:  
Retirement benefit plans:  
Adjustment for amortization of prior service credit and net losses recognized during the period in net periodic benefit cost, net of taxes of $1,518 and $2,027, respectively
4,376 5,845 
Reclassification adjustment for impact of D&Os of the PUC included in regulatory assets, net of taxes of $(1,500) and $(2,015), respectively
(4,325)(5,811)
Other comprehensive income, net of taxes51 34 
Comprehensive income attributable to Hawaiian Electric Company, Inc.
$46,460 $43,392 
This report should be read in conjunction with the Notes herein and the Notes to Consolidated Financial Statements appearing in the 2021 Form 10-K.
7

Hawaiian Electric Company, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets (unaudited)
(dollars in thousands, except par value)March 31, 2022December 31, 2021
Assets  
Property, plant and equipment
Utility property, plant and equipment  
Land$52,057 $51,937 
Plant and equipment7,796,069 7,735,983 
Less accumulated depreciation(2,985,762)(2,940,517)
Construction in progress212,748 204,569 
Utility property, plant and equipment, net5,075,112 5,051,972 
Nonutility property, plant and equipment, less accumulated depreciation of $60 and $59 as of March 31, 2022 and December 31, 2021, respectively
6,948 6,949 
Total property, plant and equipment, net5,082,060 5,058,921 
Current assets  
Cash and cash equivalents29,055 52,169 
Restricted cash2,140 3,089 
Customer accounts receivable, net181,400 186,859 
Accrued unbilled revenues, net140,005 129,155 
Other accounts receivable, net7,040 7,267 
Fuel oil stock, at average cost139,372 104,078 
Materials and supplies, at average cost72,706 71,877 
Prepayments and other41,415 46,031 
Regulatory assets78,875 66,664 
Total current assets692,008 667,189 
Other long-term assets  
Operating lease right-of-use assets114,478 101,470 
Regulatory assets480,286 498,879 
Other166,344 165,166 
Total other long-term assets761,108 765,515 
Total assets$6,535,176 $6,491,625 
Capitalization and liabilities  
Capitalization  
Common stock ($6 2/3 par value, authorized 50,000,000 shares; outstanding 17,753,533 shares at
March 31, 2022 and December 31, 2021)
$118,376 $118,376 
Premium on capital stock798,526 798,526 
Retained earnings1,363,211 1,348,277 
Accumulated other comprehensive loss, net of tax benefits-retirement benefit plans(3,229)(3,280)
Common stock equity2,276,884 2,261,899 
Cumulative preferred stock — not subject to mandatory redemption34,293 34,293 
Long-term debt, net1,624,599 1,624,427 
Total capitalization3,935,776 3,920,619 
Commitments and contingencies (Note 3)
Current liabilities  
Current portion of operating lease liabilities39,958 49,368 
Current portion of long-term debt, net51,982 51,975 
Short-term borrowings from non-affiliates6,000 — 
Accounts payable168,189 160,007 
Interest and preferred dividends payable28,154 17,325 
Taxes accrued, including revenue taxes181,324 208,280 
Regulatory liabilities29,928 29,760 
Other80,218 71,569 
Total current liabilities585,753 588,284 
Deferred credits and other liabilities  
Operating lease liabilities88,689 65,780 
Deferred income taxes406,324 408,634 
Regulatory liabilities973,516 967,008 
Unamortized tax credits101,967 103,945 
Defined benefit pension and other postretirement benefit plans liability315,675 321,780 
Other127,476 115,575 
Total deferred credits and other liabilities2,013,647 1,982,722 
Total capitalization and liabilities$6,535,176 $6,491,625 
This report should be read in conjunction with the Notes herein and the Notes to Consolidated Financial Statements appearing in the 2021 Form 10-K.
8

Hawaiian Electric Company, Inc. and Subsidiaries
Condensed Consolidated Statements of Changes in Common Stock Equity (unaudited)
 
 Common stockPremium
on
capital		RetainedAccumulated
other
comprehensive		 
(in thousands)SharesAmountstockearningsincome (loss)Total
Balance, December 31, 202117,753 $118,376 $798,526 $1,348,277 $(3,280)$2,261,899 
Net income for common stock— — — 46,409 — 46,409 
Other comprehensive income, net of taxes— — — — 51 51 
Common stock dividends— — — (31,475)— (31,475)
Balance, March 31, 202217,753 $118,376 $798,526 $1,363,211 $(3,229)$2,276,884 
Balance, December 31, 202017,324 $115,515 $746,987 $1,282,335 $(2,919)$2,141,918 
Net income for common stock— — — 43,358 — 43,358 
Other comprehensive income, net of taxes— — — — 34 34 
Common stock dividends— — — (27,925)— (27,925)
Balance, March 31, 202117,324 $115,515 $746,987 $1,297,768 $(2,885)$2,157,385 
This report should be read in conjunction with the Notes herein and the Notes to Consolidated Financial Statements appearing in the 2021 Form 10-K.


9

Hawaiian Electric Company, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows (unaudited)
Three months ended March 31
(in thousands)20222021
Cash flows from operating activities  
Net income$46,908 $43,857 
Adjustments to reconcile net income to net cash provided by operating activities  
Depreciation of property, plant and equipment58,471 57,355 
Other amortization6,355 6,577 
Deferred income taxes(6,021)(4,671)
State refundable credit(2,759)(2,662)
Bad debt expense1,619 457 
Allowance for equity funds used during construction(2,409)(2,191)
Other(2)(1)
Changes in assets and liabilities  
Decrease in accounts receivable16,236 6,078 
Increase in accrued unbilled revenues(10,825)(427)
Increase in fuel oil stock(35,294)(16,450)
Increase in materials and supplies(829)(2,382)
Increase in regulatory assets(5,089)(14,869)
Increase (decrease) in regulatory liabilities5,520 (4,716)
Increase in accounts payable29,624 6,254 
Change in prepaid and accrued income taxes, tax credits and revenue taxes(16,080)(24,802)
Decrease in defined benefit pension and other postretirement benefit plans liability(1,206)(1,434)
Change in other assets and liabilities(7,444)(14,012)
Net cash provided by operating activities76,775 31,961 
Cash flows from investing activities  
Capital expenditures(76,358)(70,361)
Other1,494 1,863 
Net cash used in investing activities(74,864)(68,498)
Cash flows from financing activities  
Common stock dividends(31,475)(27,925)
Preferred stock dividends of Hawaiian Electric and subsidiaries(499)(499)
Repayment of short-term debt— (50,000)
Proceeds from issuance of long-term debt— 115,000 
Net increase in short-term borrowings from non-affiliates and affiliates with original maturities of three months or less6,000 — 
Other— (116)
Net cash provided by (used in) financing activities(25,974)36,460 
Net decrease in cash, cash equivalents and restricted cash(24,063)(77)
Cash, cash equivalents and restricted cash, beginning of period55,258 63,326 
Cash, cash equivalents and restricted cash, end of period31,195 63,249 
Less: Restricted cash(2,140)(11,506)
Cash and cash equivalents, end of period$29,055 $51,743 
This report should be read in conjunction with the Notes herein and the Notes to Consolidated Financial Statements appearing in the 2021 Form 10-K.

10

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
Note 1 · Basis of presentation
The accompanying unaudited condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP) for interim financial information, the instructions to SEC Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In preparing the unaudited condensed consolidated financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the balance sheet and the reported amounts of revenues and expenses for the period. Actual results could differ significantly from those estimates. The accompanying unaudited condensed consolidated financial statements and the following notes should be read in conjunction with the audited consolidated financial statements and the notes thereto in HEI’s and Hawaiian Electric’s Form 10-K for the year ended December 31, 2021.
In the opinion of HEI’s and Hawaiian Electric’s management, the accompanying unaudited condensed consolidated financial statements contain all material adjustments required by GAAP to fairly state consolidated HEI’s and Hawaiian Electric’s financial positions as of March 31, 2022 and December 31, 2021 and the results of their operations and cash flows for the three months ended March 31, 2022 and 2021. All such adjustments are of a normal recurring nature, unless otherwise disclosed below or in other referenced material. Results of operations for interim periods are not necessarily indicative of results for the full year.
Recent accounting pronouncements.
Credit Losses. In March 2022, Financial Accounting Standards Board issued Accounting Standards Update (ASU) No. 2022-02, “Financial Instruments-Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures,” which eliminates the accounting guidance for Troubled Debt Restructurings (TDRs) by creditors in Subtopic 310-40, Receivables-Troubled Debt Restructurings by Creditors, while enhancing disclosure requirements for certain loan refinancings and restructurings by creditors when a borrower is experiencing financial difficulty. Specifically, rather than applying the recognition and measurement guidance for TDRs, an entity must apply the loan refinancing and restructuring guidance in paragraphs 310-20-35-9 through 35-11 to determine whether a modification results in a new loan or a continuation of an existing loan. The amendments in this update also require that an entity disclose current-period gross write-offs by year of origination for financing receivables and net investments in leases within the scope of Subtopic 326-20, “Financial Instruments-Credit Losses-Measured at Amortized Cost.” Gross write-off information must be included in the vintage disclosures required for public business entities in accordance with paragraph 325-20-50-6, which requires that an entity disclose the amortized cost basis of financing receivables by credit-quality indicator and class of financing receivable by year of origination. The amendments in this update are effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. ASB is assessing the requirements of the ASU.
11

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - continued (Unaudited)
Note 2 · Segment financial information
(in thousands) Electric utilityBankOtherTotal
Three months ended March 31, 2022    
Revenues from external customers$708,788 $75,115 $1,165 $785,068 
Intersegment revenues (eliminations)4 — (4)— 
Revenues$708,792 $75,115 $1,161 $785,068 
Income (loss) before income taxes$59,446 $30,215 $(2,181)$87,480 
Income taxes (benefit)12,538 6,345 (1,043)17,840 
Net income (loss)46,908 23,870 (1,138)69,640 
Preferred stock dividends of subsidiaries499 — (26)473 
Net income (loss) for common stock$46,409 $23,870 $(1,112)$69,167 
Total assets (at March 31, 2022)
$6,535,176 $9,252,325 $120,928 $15,908,429 
Three months ended March 31, 2021    
Revenues from external customers$564,855 $77,131 $960 $642,946 
Intersegment revenues (eliminations)9 — (9)— 
Revenues$564,864 $77,131 $951 $642,946 
Income (loss) before income taxes$55,090 $37,102 $(11,996)$80,196 
Income taxes (benefit)11,233 7,546 (3,414)15,365 
Net income (loss)43,857 29,556 (8,582)64,831 
Preferred stock dividends of subsidiaries499 — (26)473 
Net income (loss) for common stock $43,358 $29,556 $(8,556)$64,358 
Total assets (at December 31, 2021)$6,491,625 $9,181,603 $149,409 $15,822,637 
 
Intercompany electricity sales of the Utilities to ASB and “other” segments are not eliminated because those segments would need to purchase electricity from another source if it were not provided by the Utilities and the profit on such sales is nominal.
Hamakua Energy, LLC’s (Hamakua Energy’s) sales to Hawaii Electric Light (a regulated affiliate) are eliminated in consolidation.
12

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - continued (Unaudited)
Note 3 · Electric utility segment
Unconsolidated variable interest entities.
Power purchase agreements.  As of March 31, 2022, the Utilities had five PPAs for firm capacity (including the Puna Geothermal Venture (PGV) PPA that went offline in May 2018 due to lava flow on Hawaii Island, but returned to service with firm capacity of 13.0 MW in the first quarter of 2021, ramped up to 23.9 MW in the second quarter of 2021, and continued to provide capacity at the same level to date) and other PPAs with independent power producers (IPPs) and Schedule Q providers (i.e., customers with cogeneration and/or power production facilities who buy power from or sell power to the Utilities), none of which are currently required to be consolidated as VIEs.
Pursuant to the current accounting standards for VIEs, the Utilities are deemed to have a variable interest in Kalaeloa Partners, L.P. (Kalaeloa), AES Hawaii, Inc. (AES Hawaii) and Hamakua Energy by reason of the provisions of the PPA that the Utilities have with the three IPPs. However, management has concluded that the Utilities are not the primary beneficiary of Kalaeloa, AES Hawaii and Hamakua Energy because the Utilities do not have the power to direct the activities that most significantly impact the three IPPs’ economic performance nor the obligation to absorb their expected losses, if any, that could potentially be significant to the IPPs. Thus, the Utilities have not consolidated Kalaeloa, AES Hawaii and Hamakua Energy in its condensed consolidated financial statements. However, Hamakua Energy is an indirect subsidiary of Pacific Current and is consolidated in HEI’s condensed consolidated financial statements.
For the other PPAs with IPPs, the Utilities have concluded that the consolidation of the IPPs was not required because either the Utilities do not have variable interests in the IPPs due to the absence of an obligation in the PPAs for the Utilities to absorb any variability of the IPPs, or the IPP was considered a “governmental organization,” and thus excluded from the scope of accounting standards for VIEs. The consolidation of any significant IPP could have a material effect on the unaudited condensed consolidated financial statements, including the recognition of a significant amount of assets and liabilities and, if such a consolidated IPP were operating at a loss and had insufficient equity, the potential recognition of such losses. If the Utilities determine they are required to consolidate the financial statements of such an IPP and the consolidation has a material effect, the Utilities would retrospectively apply accounting standards for VIEs to the IPP.
Commitments and contingencies.
Contingencies. The Utilities are subject in the normal course of business to pending and threatened legal proceedings. Management does not anticipate that the aggregate ultimate liability arising out of these pending or threatened legal proceedings will be material to its financial position. However, the Utilities cannot rule out the possibility that such outcomes could have a material effect on the results of operations or liquidity for a particular reporting period in the future.
Power purchase agreements.  Purchases from all IPPs were as follows:
 Three months ended March 31
(in millions)20222021
Kalaeloa$60 $37 
AES Hawaii27 30 
HPOWER19 17 
Hamakua Energy16 11 
Puna Geothermal Venture10 4 
Wind IPPs18 29 
Solar IPPs13 12 
Other IPPs 1
1 2 
Total IPPs$164 $142 
1Includes hydro power and other PPAs
Kalaeloa Partners, L.P.  Under a 1988 PPA, as amended, Hawaiian Electric is committed to purchase 208 MW of firm capacity from Kalaeloa. In October 2021, Hawaiian Electric and Kalaeloa signed the Amended and Restated Power Purchase Agreement for Firm Dispatchable Capacity and Energy (Amended and Restated PPA) to extend the PPA for an additional term of 10 years. In November 2021, Hawaiian Electric submitted an application for approval of the Amended and Restated PPA to the PUC, which is pending approval before the PUC. The price of purchases from Kalaeloa in the first quarter of 2022 have increased 62% over the first quarter of 2021, primarily due to increased fuel oil cost.
13

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - continued (Unaudited)
AES Hawaii, Inc. Under a PPA entered into in March 1988, as amended (through Amended and Restated Amendment No. 4) for a period of 30 years ending September 2022, Hawaiian Electric agreed to purchase 180 MW of firm capacity from AES Hawaii. Hawaiian Electric does not intend to extend the term of the PPA which will expire on September 1, 2022.
Hu Honua Bioenergy, LLC (Hu Honua). In May 2012, Hawaii Electric Light signed a PPA, which the PUC approved in December 2013, with Hu Honua for 21.5 MW of renewable, dispatchable firm capacity fueled by locally grown biomass from a facility on the island of Hawaii. Under the terms of the PPA, the Hu Honua plant was scheduled to be in service in 2016. However, Hu Honua encountered construction and litigation delays, which resulted in an amended and restated PPA between Hawaii Electric Light and Hu Honua dated May 9, 2017. In July 2017, the PUC approved the amended and restated PPA, which becomes effective once the PUC’s order is final and non-appealable. In August 2017, the PUC’s approval was appealed by a third party. On May 10, 2019, the Hawaii Supreme Court issued a decision remanding the matter to the PUC for further proceedings consistent with the court’s decision, which must include express consideration of greenhouse gas (GHG) emissions that would result from approving the PPA, whether the cost of energy under the PPA is reasonable in light of the potential for GHG emissions, and whether the terms of the PPA are prudent and in the public interest, in light of its potential hidden and long-term consequences. As a result, the PUC reopened the docket for further proceedings, including re-examining all of the issues in the proceedings. On July 9, 2020, the PUC issued an order denying Hawaii Electric Light’s request to waive the amended and restated PPA from the PUC’s competitive bidding requirements and therefore, dismissed the request for approval of the amended and restated PPA without prejudice to possible participation in any future competitive bidding process. On September 9, 2020, the PUC denied Hu Honua’s motion for reconsideration of the PUC’s order. Hu Honua filed its notice of appeal to the Hawaii Supreme Court of the PUC’s order denying Hu Honua’s motion for reconsideration. On May 24, 2021, the Hawaii Supreme Court vacated the PUC’s decision and remanded the matter back to the PUC for further proceedings. On June 30, 2021, the PUC issued an order reopening the docket consistent with the Hawaii Supreme Court’s order. A contested case hearing was held in March 2022. The matter is currently with the PUC for decision making.
Molokai New Energy Partners (MNEP). In July 2018, the PUC approved Maui Electric’s PPA with MNEP to purchase solar energy from a photovoltaic (PV) plus battery storage project. The 4.88 MW PV and 3 MW Battery Energy Storage System project was to deliver no more than 2.64 MW at any time to the Molokai system. On March 25, 2020, MNEP filed a complaint in the United Stated District Court for the District of Hawaii against Maui Electric claiming breach of contract. On June 3, 2020, Maui Electric provided Notice of Default and Termination of the PPA to MNEP terminating the PPA with an effective date of July 10, 2020. Thereafter, MNEP filed an amended Complaint to include claims relating to the termination and Hawaiian Electric filed its Answer to the Amended Complaint on September 11, 2020, disputing the facts presented by MNEP and all claims within the original and amended complaint. Currently, the discovery phase is ongoing.
Fuels barging contract. On August 23, 2021, the Utilities entered into a five-year inter-island fuel transportation contract with Sause Bros., Inc. On December 23, 2021, the PUC issued an interim D&O approving the inter-island fuels transportation contract and recovery of associated costs on an interim basis. The interim decision is effective until the PUC issues its final D&O in the proceeding. The Utility recorded a lease liability of $32 million in connection with the contract, which commenced in January 2022 with an estimated annual base rent of $6.2 million.
Utility projects.  Many public utility projects require PUC approval and various permits from other governmental agencies. Difficulties in obtaining, or the inability to obtain, the necessary approvals or permits or community support can result in significantly increased project costs or even cancellation of projects. In the event a project does not proceed, or if it becomes probable the PUC will disallow cost recovery for all or part of a project, or if PUC-imposed caps on project costs are expected to be exceeded, project costs may need to be written off in amounts that could result in significant reductions in Hawaiian Electric’s consolidated net income.
Enterprise Resource Planning/Enterprise Asset Management (ERP/EAM) implementation project. The ERP/EAM Implementation Project went live in October 2018. Hawaii Electric Light and Hawaiian Electric began to incorporate their portion of the deferred project costs in rate base and started the amortization over a 12-year period in January 2020 and November 2020, respectively. The PUC required a minimum of $246 million ERP/EAM project-related benefit to be delivered to customers over the system’s 12-year service life.
In February 2019, the PUC approved a methodology for passing the future cost saving benefits of the new ERP/EAM system to customers developed by the Utilities in collaboration with the Consumer Advocate. The Utilities filed a benefits clarification document on June 10, 2019, reflecting $150 million in future net O&M expense reductions and cost avoidance, and $96 million in capital cost reductions and tax savings over the 12-year service life. To the extent the reduction in O&M expense relates to amounts reflected in electric rates, the Utilities would reduce future rates for such amounts. In October 2019, the PUC approved the Utilities and the Consumer Advocate’s Stipulated Performance Metrics and Tracking Mechanism. As of March 31, 2022, the Utilities’ regulatory liability was $9.1 million ($5.1 million for Hawaiian Electric, $1.6 million for Hawaii
14

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - continued (Unaudited)
Electric Light and $2.4 million for Maui Electric) for the O&M expense savings that are being amortized or to be included in future rates. As part of the settlement agreement approved in the Hawaiian Electric 2020 test year rate case, the regulatory liability for Hawaiian Electric will be amortized over five years, beginning in November 2020, and the O&M benefits for Hawaiian Electric was considered flowed through to customers.
On July 7, 2021, the PUC issued an order modifying the reporting frequency of the Semi-Annual Enterprise System Benefits (SAESB) reports to an Annual Enterprise System Benefits (AESB) report on the achieved benefits savings. The most recent SAESB report was filed on February 14, 2022 for the period January 1 through December 31, 2021.
Environmental regulation.  The Utilities are subject to environmental laws and regulations that regulate the operation of existing facilities, the construction and operation of new facilities and the proper cleanup and disposal of hazardous waste and toxic substances.
Hawaiian Electric, Hawaii Electric Light and Maui Electric, like other utilities, periodically encounter petroleum or other chemical releases associated with current or previous operations. The Utilities report and take action on these releases when and as required by applicable law and regulations. The Utilities believe the costs of responding to such releases identified to date will not have a material effect, individually or in the aggregate, on Hawaiian Electric’s consolidated results of operations, financial condition or liquidity.
Former Molokai Electric Company generation site.  In 1989, Maui Electric acquired Molokai Electric Company. Molokai Electric Company had sold its former generation site (Site) in 1983, but continued to operate at the Site under a lease until 1985 and left the property in 1987. The federal Environmental Protection Agency (EPA) has since identified environmental impacts in the subsurface soil at the Site. In cooperation with the Department of Health of State of Hawaii (DOH) and EPA, Maui Electric further investigated the Site and the adjacent parcel to determine the extent of impacts of polychlorinated biphenyls (PCBs), residual fuel oils and other subsurface contaminants. Maui Electric has a reserve balance of $2.7 million as of March 31, 2022, representing the probable and reasonably estimable undiscounted cost for remediation of the Site and the adjacent parcel based on presently available information; however, final costs of remediation will depend on the cleanup approach implemented.
Additionally, on November 24, 2021, the current landowners of the Site, Misaki’s, Inc., filed a lawsuit against Hawaiian Electric (as alleged successor in interest to Molokai Electric, the prior owner of the Site) in the Circuit Court of the Second Circuit of the State of Hawaii (removed to the U.S. District Court for the District of Hawaii). The complaint which was subsequently amended to include Maui Electric, alleges that Hawaiian Electric is responsible for remediation of the Site based on the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (CERCLA), and the Hawaii Environmental Response Law under Hawaii Revised Statutes Chapter 128D, as well as being liable on contractual claims related to a short leaseback period during the transition of ownership from Molokai Electric. At this time, the Utilities are unable to determine the ultimate outcome of the lawsuit or the amount of any possible loss. The Utilities intend to vigorously defend the action.
Pearl Harbor sediment study. In July 2014, the U.S. Navy notified Hawaiian Electric of the Navy’s determination that Hawaiian Electric is a Potentially Responsible Party under CERCLA responsible for the costs of investigation and cleanup of PCB contamination in sediment in the area offshore of the Waiau Power Plant as part of the Pearl Harbor Superfund Site. Hawaiian Electric was also required by the EPA to assess potential sources and extent of PCB contamination onshore at Waiau Power Plant.
As of March 31, 2022, the reserve account balance recorded by Hawaiian Electric to address the PCB contamination was $10.1 million. The reserve balance represents the probable and reasonably estimable undiscounted cost for the onshore and offshore investigation and remediation. The final remediation costs will depend on the actual onshore and offshore cleanup costs.
Regulatory proceedings
Decoupling. Decoupling is a regulatory model that is intended to provide the Utilities with financial stability and facilitate meeting the State of Hawaii’s goals to transition to a clean energy economy and achieve an aggressive renewable portfolio standard. Decoupling delinks the utility’s revenues from the utility’s sales, removing the disincentive to promote energy efficiency and accept more renewable energy. Decoupling continues under the PBR Framework.
Performance-based regulation framework. On December 23, 2020, the PUC issued a D&O (PBR D&O) establishing a new PBR Framework to govern the Utilities. The PBR Framework incorporates an annual revenue adjustment (ARA) and a suite of new regulatory mechanisms in addition to previously established regulatory mechanisms. Under the PBR Framework, the decoupling mechanism (i.e., the Revenue Balancing Account (RBA)) established by the previous regulatory framework will
15

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - continued (Unaudited)
continue. The existing cost recovery mechanisms will continue as currently implemented (i.e., the Energy Cost Recovery Clause (ECRC), Purchased Power Adjustment Clause (PPAC), Demand Side Management surcharge (DSM), Renewable Energy Infrastructure Program (REIP), Demand Response Adjustment Clause (DRAC), Pension and Other Post-Employment Benefits (OPEB) tracking mechanisms). In addition to annual revenues provided by the ARA, the Utilities may seek relief for extraordinary projects or programs through the Exceptional Project Recovery Mechanism (EPRM) (formerly known as the Major Project Interim Recovery adjustment mechanism) and earn financial rewards for exemplary performance as provided through a portfolio of Performance Incentive Mechanisms (PIMs) and Shared Savings Mechanisms (SSMs). The PBR Framework incorporates a variety of additional performance mechanisms, including Scorecards, Reported Metrics, and an expedited Pilot Process. The PBR Framework also contains a number of safeguards, including a symmetric Earnings Sharing Mechanism (ESM) which protects the Utilities and customers from excessive earnings or losses, as measured by the Utilities’ achieved rate-making ROACE and a Re-Opener mechanism, under which the PUC will open an examination, at its discretion, to determine if adjustments or modifications to specific PBR mechanisms are appropriate. The new PBR Framework became fully effective on June 1, 2021.
On September 17, 2021, the PUC issued an order introducing the PUC staff’s proposal for the development of new PIMs to address the following areas of concern:
•Grid reliability,
•Timely retirement of fossil fuel generation units,
•Interconnection of large-scale renewable energy projects,
•Cost control for fossil fuel, purchased power, and other non-ARA costs, and
•Expedient utilization of grid services from demand-side resources
The order also established a procedural schedule, including technical conferences, statements of position, and a PUC hearing, to govern the PBR Working Group’s review and development of the new PIMs. On March 10, 2022, the PUC issued an order modifying the procedural schedule. In accordance with the modified procedural schedule, the PBR Parties filed final statements of position on April 8, 2022. The PUC hearing was held on April 26 to 27, 2022.
Revenue adjustment mechanism. Prior to the implementation of the PBR Framework, the RAM was a major component of the previously established regulatory framework. The RAM was based on the lesser of: a) an inflationary adjustment for certain O&M expenses and return on investment for certain rate base changes, or b) cumulative annual compounded increase in Gross Domestic Product Price Index applied to annualized target revenues (the RAM Cap). All Utilities were limited to the RAM Cap in 2020. Under the PBR Framework, the ARA mechanism replaced the RAM, and became effective on June 1, 2021. RAM revenue adjustments approved by the PUC in 2020 will continue to be included in the RBA provision’s target revenue and RBA rate adjustment unless modified with PUC approval.
Annual revenue adjustment mechanism. The PBR Framework established a five-year multi-year rate period during which there will be no general rate cases. Target revenues will be adjusted according to an index-driven ARA based on (i) an inflation factor, (ii) a predetermined X-factor to encompass productivity, which is set at zero, (iii) a Z-factor to account for exceptional circumstances not in the Utilities’ control and (iv) a customer dividend consisting of a negative adjustment of 0.22% of adjusted revenue requirements compounded annually and a flow through of the “pre-PBR” savings commitment from the management audit recommendations developed in a prior docket at a rate of $6.6 million per year from 2021 to 2025. The implementation of the ARA occurred on June 1, 2021.
Earnings sharing mechanism. A symmetrical ESM for achieved rate-making ROACE outside of a 300 basis points dead band above or below the current authorized ROACE of 9.5% for each of the Utilities. There is a 50/50 sharing between customers and Utilities for the achieved rate-making ROACE falling within 150 basis points outside of the dead band in either direction, and a 90/10 sharing for any further difference. A reopening or review of the PBR terms will be triggered if the Utilities credit rating outlook indicates a potential credit downgrade below investment grade status, or if its achieved rate-making ROACE enters the outer most tier of the ESM.
Exceptional project recovery mechanism. Prior to the implementation of the PBR Framework, the PUC established the Major Project Interim Recovery (MPIR) adjustment mechanism and MPIR Guidelines. The MPIR mechanism provides the opportunity to recover revenues for net costs of approved eligible projects placed in service between general rate cases. In establishing the PBR Framework, the MPIR Guidelines were terminated and replaced with the EPRM Guidelines. Although the MPIR Guidelines were terminated and replaced by the EPRM Guidelines, the MPIR mechanism will continue within the PBR Framework to provide recovery of project costs previously approved for recovery under the MPIR. The newly established EPRM Guidelines permit the Utilities to include the full amount of approved costs in the EPRM for recovery in the first year the project goes into service, pro-rated for the portion of the year the project is in service. Deferred and O&M expense projects
16

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - continued (Unaudited)
are also eligible for EPRM recovery under the EPRM Guidelines. EPRM recoverable costs will be limited to the lesser of actual incurred project costs or PUC‑approved amounts, net of savings.
As of March 31, 2022, the Utilities submitted 2022 MPIR amounts totaling $25.9 million, including revenue taxes, for the Schofield Generating Station ($16.5 million), West Loch PV Project ($3.3 million), and Grid Modernization Strategy (GMS) Phase 1 project ($6.1 million for all three utilities) for the accrual of revenues effective January 1, 2022, that included the 2022 return on project amount (based on approved amounts) in rate base, depreciation and incremental O&M expenses. Subject to PUC approval, the Utilities will begin recovery of the annualized 2022 MPIR amounts effective June 1, 2022 through the RBA rate adjustment.
As of March 31, 2022, the PUC approved two EPRM projects totaling $41 million to the extent that the project costs are not included in rates. Currently, the Utilities are seeking EPRM recovery of five projects with total project costs of $264 million, subject to PUC approval.
Pilot process. The PBR D&O approved a Pilot Process to foster innovation by establishing an expedited implementation process for pilots that test new technologies, programs, business models, and other arrangements. This is intended to support initiatives by the Utilities to test new programs and ideas quickly and elevate any successful pilots for consideration of full-scale implementation. The proposed pilots would be subject to PUC approval with a total annual cap of $10 million. The Pilot Process will feature the two primary activities: an initial “Workplan Development” phase, during which the Utilities identify and scope areas of interests, so as to inform the subsequent “Implementation” phase, during which the Utilities submit specific pilot proposals for expedited review by the PUC and implement the pilot upon approval. The PUC will issue an order, approving, denying, or modifying a proposed Pilot within 45 days of receiving notice of a specific pilot project.
On July 9, 2021, the PUC issued an order approving the Utilities’ proposed Pilot Process submitted in April 2021 with modifications, including a cost recovery process that generally allows the Utilities to defer and recover total annual expenditures of approved pilot projects in full over twelve months beginning June 1 of the year following implementation through the RBA rate adjustment, although the Utilities may determine on a case-by-case basis that a particular project’s deferred costs should be amortized over a period greater than twelve months. On July 28, 2021, the Utilities submitted the finalized Pilot Process to govern the review of the pilot project proposals in accordance with the July 9, 2021 order.
On November 12, 2021, the Utilities requested PUC approval of their proposed Pilot Process Workplan to guide the development of pilot projects over the next three years. A PUC order on the Workplan is pending.
On February 28, 2022, the Utilities filed their first annual Pilot Update report covering pilot projects approved through the Pilot Process framework. The Pilot Update reported on approximately $0.1 million of 2021 deferred costs to be reviewed by the PUC in their review of the Utilities’ proposed adjustments to target revenue in the 2022 spring revenue report.
Performance incentive mechanisms. The PUC has established the following PIMs: (1) Service Quality performance incentives, (2) Phase 1 Request for proposal (RFP) PIM for procurement of low-cost renewable energy, (3) Phase 2 RFP PIMs for generation and generation plus storage project, and Grid Services and standalone storage, (4) new PIMs established in the PBR D&O.
•Service Quality performance incentives (ongoing). Service Quality performance incentives are measured on a calendar-year basis. The PIM tariff requires the performance targets, deadbands and the amount of maximum financial incentives used to determine the PIM financial incentive levels for each of the PIMs to remain constant in interim periods, unless otherwise amended by order of the PUC.
•Service Reliability Performance measured by System Average Interruption Duration and Frequency Indexes (penalties only). Target performance is based on each utility’s historical 10-year average performance with a deadband of one standard deviation. The maximum penalty for each performance index is 20 basis points applied to the common equity share of each respective utility’s approved rate base (or maximum penalties of approximately $6.8 million - for both indices in total for the three utilities). For the 2021 evaluation period, the Utilities earned $0.2 million in penalties.
•Call Center Performance measured by the percentage of calls answered within 30 seconds. Target performance is based on the annual average performance for each utility for the most recent 8 quarters with a deadband of 3% above and below the target. The maximum penalty or reward is 8 basis points applied to the common equity share of each respective utility’s approved rate base (or maximum penalties or rewards of approximately $1.4 million - in total for the three utilities).
•Phase 1 RFP PIM. Procurement of low-cost variable renewable resources through the RFP process in 2018 is measured by comparison of the procurement price to target prices. Half of the incentive was earned upon PUC
17

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - continued (Unaudited)
approval of the PPAs. Based on the seven PPAs approved in 2019, the Utilities recognized $1.7 million in 2019 with the remaining award to be recognized in the year following the in-service date of the projects, which is estimated to occur from 2023 to 2024.
•Phase 2 RFP PIMs. The PUC order issued on October 9, 2019 establishes pricing thresholds, timelines to complete contracting, and other performance criteria for the performance incentive eligibility. The PIMs provide incentives only without penalties. On July 9, 2020, the Utilities filed two Grid Services Purchase Agreements (GSPA) for the Grid Service RFP that potentially qualify for a demand response PIM; however, details of the incentive metrics will be determined by the PUC. On September 15, 2020, the Utilities filed a PPA that qualified for a PIM incentive and on February 16, 2021, the Utilities filed one additional PPA that qualified for a declining PIM incentive. The PUC approved two PPAs in September 2021 and November 2021 and two GSPAs on December 31, 2020. For the 2021 evaluation period, the Utilities earned $0.1 million in rewards related to the two PPAs.
•The PUC established the following two new PIMs in its PBR D&O, which were approved in an order issued on March 23, 2021 and became effective on June 1, 2021.
•Renewable portfolio standard (RPS)-A PIM that provides a financial reward for accelerating the achievement of RPS goals. The Utilities may earn a reward for the amount of system generation above the interpolated statutory RPS goal at $20/MWh in 2021 and 2022, $15/MWh in 2023, and $10/MWh for the remainder of the multi-year rate period (MRP). Penalties are already prescribed in the RPS as $20/MWh for failing to meet RPS targets in 2030, 2040 and 2045. The evaluation period commenced on January 1, 2021. For the 2021 evaluation period, the Utilities earned $1.0 million in rewards.
•Grid Services Procurement PIM that provides financial rewards for grid services acquired in 2021 and 2022. The Utilities can earn a total maximum reward of $1.5 million over 2021 and 2022. The evaluation period commenced on January 1, 2021.
•The PUC also established the following three new PIMs in its PBR D&O, which were approved by the PUC on May 17, 2021 and became effective on June 1, 2021.
•Interconnection Approval PIM that provides financial rewards and penalties for interconnection times for distributed energy resources systems <100 kW in size. The Utilities can earn a total annual maximum reward of $3.0 million or a total annual maximum penalty of $0.9 million. For the 2021 evaluation period, the Utilities earned $2.8 million in rewards.
•Low-to-Moderate Income (LMI) Energy Efficiency PIM that provides financial reward for collaboration between the Utilities and the third-party Public Benefits Fee Administrator to deliver energy savings for low- and moderate-income customers. The Utilities can earn a total annual maximum reward of $2.0 million. The PIM will initially have a duration of three years and be subject to an annual review. The evaluation period is based on Hawaii Energy’s program year with the initial evaluation year being the period of July 1, 2021 through June 30, 2022.
•Advanced Metering Infrastructure Utilization PIM that provides financial rewards for leveraging grid modernization investments and engaging customers beyond what is already planned in the Phase 1 Grid Modernization program. The Utilities can earn a total annual maximum reward of $2.0 million. The PIM will initially have a duration of three years after which it will be re-evaluated. The evaluation period commenced on January 1, 2021.
For the 2021 evaluation period, the Utilities accrued $3.7 million ($2.8 million for Hawaiian Electric, $0.4 million for Hawaii Electric Light and $0.5 million for Maui Electric) in rewards net of penalties. The net rewards related to 2021 were reflected in the 2021 fall revenue report and 2022 spring revenue report filings.
Annual review cycle. PBR D&O established an annual review cycle for revenue adjustments under the PBR Framework, including the biannual submission of the revenue reports. The Utilities filed the spring revenue report on March 31, 2022, which is subject to PUC approval.

The net incremental amounts between the 2021 fall and 2022 spring revenue reports are proposed to be collected (refunded) from June 1, 2022 through May 31, 2023 as follows:
18

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - continued (Unaudited)
(in millions)Hawaiian ElectricHawaii Electric LightMaui ElectricTotal
Incremental accrued RBA balance through September 30, 2021 (and associated revenue taxes)$(5.7)$2.1 $(4.7)$(8.3)
Incremental Performance Incentive Mechanisms (net)
1.9 0.4 0.4 2.7 
Incremental MPIR/EPRM Revenue Adjustment1.3 0.8 0.7 2.8
Other(0.1)— — $(0.1)
Net incremental amount to be collected under the RBA rate tariffs$(2.6)$3.3 $(3.6)$(2.9)

Regulatory assets for COVID-19 related costs. On May 4, 2020, the PUC issued an order, authorizing all utilities, including the Utilities, to establish regulatory assets to record costs resulting from the suspension of disconnections of service during the pendency of the Governor’s Emergency Proclamation and until otherwise ordered by the PUC. In future proceedings, the PUC will consider the reasonableness of the costs, the appropriate period of recovery, any amount of carrying costs thereon, and any savings directly attributable to suspension of disconnects, and other related matters. As part of the order, the PUC prohibits the Utilities from charging late payment fees on past due payments. As the moratorium on customer disconnections ended on May 31, 2021, the Utilities have resumed charging late payment fees in July 2021. Pursuant to PUC orders, the deferral of COVID-19 related costs by the Utilities ended on December 31, 2020. On October 1, 2021, the PUC approved the Utilities’ request to extend the deferral period to December 31, 2021. In December 2021, to keep customers connected and provide some relief to customers experiencing financial difficulty during the pandemic, the Utilities committed to issuing $2 million in bill credits to qualified customers. The Utilities will not seek recovery for the issued bill credits, resulting in a reduction to the cumulative deferred costs. As of March 31, 2022, the Utilities had recorded a total of $27.8 million in regulatory assets pursuant to the orders.
Condensed consolidating financial information. Condensed consolidating financial information for Hawaiian Electric and its subsidiaries are presented for the three month periods ended March 31, 2022 and 2021, and as of March 31, 2022 and December 31, 2021.
Hawaiian Electric unconditionally guarantees Hawaii Electric Light’s and Maui Electric’s obligations (a) to the State of Hawaii for the repayment of principal and interest on Special Purpose Revenue Bonds issued for the benefit of Hawaii Electric Light and Maui Electric, and (b) under their respective private placement note agreements and the Hawaii Electric Light notes and Maui Electric notes issued thereunder. Hawaiian Electric is also obligated, after the satisfaction of its obligations on its own preferred stock, to make dividend, redemption and liquidation payments on Hawaii Electric Light’s and Maui Electric’s preferred stock if the respective subsidiary is unable to make such payments.
19

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - continued (Unaudited)
Hawaiian Electric Company, Inc. and Subsidiaries
Condensed Consolidating Statement of Income
Three months ended March 31, 2022
(in thousands)Hawaiian ElectricHawaii Electric LightMaui ElectricOther subsidiariesConsolidating adjustmentsHawaiian Electric
Consolidated
Revenues$500,242 108,528 100,028 — (6)$708,792 
Expenses
Fuel oil154,425 25,251 41,610 — — 221,286 
Purchased power124,183 30,712 8,638 — — 163,533 
Other operation and maintenance83,656 20,214 21,387 — — 125,257 
Depreciation39,484 10,351 8,636 — — 58,471 
Taxes, other than income taxes47,274 10,032 9,344 — — 66,650 
   Total expenses449,022 96,560 89,615 — — 635,197 
Operating income51,220 11,968 10,413 — (6)73,595 
Allowance for equity funds used during construction1,990 193 226 — — 2,409 
Equity in earnings of subsidiaries13,661 — — — (13,661)— 
Retirement defined benefits credit (expense)—other than service costs855 167 (32)— — 990 
Interest expense and other charges, net(13,093)(2,609)(2,630)— 6 (18,326)
Allowance for borrowed funds used during construction651 60 67 — — 778 
Income before income taxes55,284 9,779 8,044 — (13,661)59,446 
Income taxes8,605 2,268 1,665 — — 12,538 
Net income46,679 7,511 6,379 — (13,661)46,908 
Preferred stock dividends of subsidiaries— 134 95 — — 229 
Net income attributable to Hawaiian Electric46,679 7,377 6,284 — (13,661)46,679 
Preferred stock dividends of Hawaiian Electric270 — — — — 270 
Net income for common stock$46,409 7,377 6,284 — (13,661)$46,409 


Hawaiian Electric Company, Inc. and Subsidiaries
Condensed Consolidating Statement of Comprehensive Income
Three months ended March 31, 2022
(in thousands)Hawaiian ElectricHawaii Electric LightMaui ElectricOther subsidiariesConsolidating adjustmentsHawaiian Electric Consolidated
Net income for common stock$46,409 7,377 6,284 — (13,661)$46,409 
Other comprehensive income, net of taxes:
Retirement benefit plans:
Adjustment for amortization of prior service credit and net losses recognized during the period in net periodic benefit cost, net of taxes4,376 670 603 — (1,273)4,376 
Reclassification adjustment for impact of D&Os of the PUC included in regulatory assets, net of taxes(4,325)(670)(603)— 1,273 (4,325)
Other comprehensive income, net of taxes51 — — — — 51 
Comprehensive income attributable to common shareholder$46,460 7,377 6,284 — (13,661)$46,460 

20

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - continued (Unaudited)

Hawaiian Electric Company, Inc. and Subsidiaries
Condensed Consolidating Statement of Income
Three months ended March 31, 2021

(in thousands)Hawaiian ElectricHawaii Electric LightMaui ElectricOther subsidiariesConsolidating adjustmentsHawaiian Electric
Consolidated
Revenues$400,554 85,149 79,181 — (20)$564,864 
Expenses
Fuel oil88,728 16,485 22,214 — — 127,427 
Purchased power108,604 21,597 12,095 — — 142,296 
Other operation and maintenance77,335 17,912 19,323 — — 114,570 
Depreciation38,914 10,048 8,393 — — 57,355 
Taxes, other than income taxes38,627 7,993 7,482 — — 54,102 
   Total expenses352,208 74,035 69,507 — — 495,750 
Operating income48,346 11,114 9,674 — (20)69,114 
Allowance for equity funds used during construction1,748 132 311 — — 2,191 
Equity in earnings of subsidiaries12,510 — — — (12,510)— 
Retirement defined benefits credit (expense)—other than service costs886 168 (33)— — 1,021 
Interest expense and other charges, net(12,832)(2,581)(2,590)— 20 (17,983)
Allowance for borrowed funds used during construction591 44 112 — — 747 
Income before income taxes51,249 8,877 7,474 — (12,510)55,090 
Income taxes7,621 2,051 1,561 — — 11,233 
Net income43,628 6,826 5,913 — (12,510)43,857 
Preferred stock dividends of subsidiaries— 134 95 — — 229 
Net income attributable to Hawaiian Electric43,628 6,692 5,818 — (12,510)43,628 
Preferred stock dividends of Hawaiian Electric270 — — — — 270 
Net income for common stock$43,358 6,692 5,818 — (12,510)$43,358 


Hawaiian Electric Company, Inc. and Subsidiaries
Condensed Consolidating Statement of Comprehensive Income
Three months ended March 31, 2021
(in thousands)Hawaiian ElectricHawaii Electric LightMaui ElectricOther subsidiariesConsolidating adjustmentsHawaiian Electric Consolidated
Net income for common stock$43,358 6,692 5,818 — (12,510)$43,358 
Other comprehensive income (loss), net of taxes:
Retirement benefit plans:
Adjustment for amortization of prior service credit and net losses recognized during the period in net periodic benefit cost, net of tax benefits5,845 835 761 — (1,596)5,845 
Reclassification adjustment for impact of D&Os of the PUC included in regulatory assets, net of taxes(5,811)(834)(761)— 1,595 (5,811)
Other comprehensive income, net of taxes34 1 — — (1)34 
Comprehensive income attributable to common shareholder$43,392 6,693 5,818 — (12,511)$43,392 

21

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - continued (Unaudited)
Hawaiian Electric Company, Inc. and Subsidiaries
Condensed Consolidating Balance Sheet
March 31, 2022
(in thousands)Hawaiian ElectricHawaii Electric LightMaui ElectricOther
subsi-
diaries		Consoli-
dating
adjustments		Hawaiian Electric
Consolidated
Assets      
Property, plant and equipment
Utility property, plant and equipment      
Land$42,857 5,606 3,594 — — $52,057 
Plant and equipment5,144,377 1,394,875 1,256,817 — — 7,796,069 
Less accumulated depreciation(1,788,280)(627,421)(570,061)— — (2,985,762)
Construction in progress164,073 19,691 28,984 — — 212,748 
Utility property, plant and equipment, net3,563,027 792,751 719,334 — — 5,075,112 
Nonutility property, plant and equipment, less accumulated depreciation
5,301 115 1,532 — — 6,948 
Total property, plant and equipment, net3,568,328 792,866 720,866 — — 5,082,060 
Investment in wholly owned subsidiaries, at equity681,998 — — — (681,998)— 
Current assets      
Cash and cash equivalents19,894 6,017 3,067 77 — 29,055 
Restricted cash2,140 — — — — 2,140 
Advances to affiliates5,000 — 12,800 — (17,800)— 
Customer accounts receivable, net128,263 27,735 25,402 — — 181,400 
Accrued unbilled revenues, net98,511 21,235 20,259 — — 140,005 
Other accounts receivable, net15,846 5,128 4,269 — (18,203)7,040 
Fuel oil stock, at average cost105,780 13,895 19,697 — — 139,372 
Materials and supplies, at average cost42,852 9,673 20,181 — — 72,706 
Prepayments and other29,677 4,602 5,883 — 1,253 41,415 
Regulatory assets69,638 4,877 4,360 — — 78,875 
Total current assets517,601 93,162 115,918 77 (34,750)692,008 
Other long-term assets      
Operating lease right-of-use assets61,826 38,368 14,284 — — 114,478 
Regulatory assets325,063 78,877 76,346 — — 480,286 
Other128,934 18,620 19,607 — (817)166,344 
Total other long-term assets515,823 135,865 110,237 — (817)761,108 
Total assets$5,283,750 1,021,893 947,021 77 (717,565)$6,535,176 
Capitalization and liabilities      
Capitalization      
Common stock equity$2,276,884 336,177 345,744 77 (681,998)$2,276,884 
Cumulative preferred stock—not subject to mandatory redemption
22,293 7,000 5,000 — — 34,293 
Long-term debt, net1,136,739 234,413 253,447 — — 1,624,599 
Total capitalization3,435,916 577,590 604,191 77 (681,998)3,935,776 
Current liabilities      
Current portion of operating lease liabilities31,078 6,370 2,510 — — 39,958 
Current portion of long-term debt39,986 11,996 — — — 51,982 
Short-term borrowings from non-affiliates6,000 — — — — 6,000 
Short-term borrowings from affiliate12,800 5,000 — — (17,800)— 
Accounts payable124,463 22,175 21,551 — — 168,189 
Interest and preferred dividends payable20,057 3,687 4,414 — (4)28,154 
Taxes accrued, including revenue taxes125,425 29,109 25,537 — 1,253 181,324 
Regulatory liabilities19,416 5,495 5,017 — — 29,928 
Other60,491 18,869 19,214 — (18,356)80,218 
Total current liabilities439,716 102,701 78,243 — (34,907)585,753 
Deferred credits and other liabilities      
Operating lease liabilities44,785 32,066 11,838 — — 88,689 
Deferred income taxes289,376 52,859 64,089 — — 406,324 
Regulatory liabilities702,745 178,224 92,547 — — 973,516 
Unamortized tax credits74,821 13,927 13,219 — — 101,967 
Defined benefit pension and other postretirement benefit plans liability
216,181 47,842 52,312 — (660)315,675 
Other80,210 16,684 30,582 — — 127,476 
Total deferred credits and other liabilities1,408,118 341,602 264,587 — (660)2,013,647 
Total capitalization and liabilities$5,283,750 1,021,893 947,021 77 (717,565)$6,535,176 

22

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - continued (Unaudited)
Hawaiian Electric Company, Inc. and Subsidiaries
Condensed Consolidating Balance Sheet
December 31, 2021
(in thousands)Hawaiian ElectricHawaii Electric LightMaui ElectricOther
subsi-diaries		Consoli-
dating
adjustments		Hawaiian Electric
Consolidated
Assets      
Property, plant and equipment
Utility property, plant and equipment      
Land$42,737 5,606 3,594 — — $51,937 
Plant and equipment5,097,033 1,390,361 1,248,589 — — 7,735,983 
Less accumulated depreciation(1,757,096)(619,991)(563,430)— — (2,940,517)
Construction in progress159,854 17,129 27,586 — — 204,569 
Utility property, plant and equipment, net3,542,528 793,105 716,339 — — 5,051,972 
Nonutility property, plant and equipment, less accumulated depreciation
5,302 115 1,532 — — 6,949 
Total property, plant and equipment, net3,547,830 793,220 717,871 — — 5,058,921 
Investment in wholly owned subsidiaries, at equity
676,237 — — — (676,237)— 
Current assets      
Cash and cash equivalents23,344 5,326 23,422 77 — 52,169 
Restricted cash3,089 — — — — 3,089 
Advances to affiliates1,000 — — — (1,000)— 
Customer accounts receivable, net135,949 28,469 22,441 — — 186,859 
Accrued unbilled revenues, net92,469 19,529 17,157 — — 129,155 
Other accounts receivable, net18,624 3,347 3,031 — (17,735)7,267 
Fuel oil stock, at average cost71,184 12,814 20,080 — — 104,078 
Materials and supplies, at average cost42,006 9,727 20,144 — — 71,877 
Prepayments and other32,140 6,052 7,114 — 725 46,031 
Regulatory assets58,695 3,051 4,918 — — 66,664 
Total current assets478,500 88,315 118,307 77 (18,010)667,189 
Other long-term assets      
Operating lease right-of-use assets78,710 22,442 318 — — 101,470 
Regulatory assets337,903 81,645 79,331 — — 498,879 
Other130,546 17,124 18,510 — (1,014)165,166 
Total other long-term assets547,159 121,211 98,159 — (1,014)765,515 
Total assets$5,249,726 1,002,746 934,337 77 (695,261)$6,491,625 
Capitalization and liabilities      
Capitalization
Common stock equity$2,261,899 332,900 343,260 77 (676,237)$2,261,899 
Cumulative preferred stock—not subject to mandatory redemption
22,293 7,000 5,000 — — 34,293 
Long-term debt, net1,136,620 234,390 253,417 — — 1,624,427 
Total capitalization3,420,812 574,290 601,677 77 (676,237)3,920,619 
Current liabilities     
Current portion of operating lease liabilities45,955 3,378 35 — — 49,368 
Current portion of long-term debt39,981 11,994 — — — 51,975 
Short-term borrowings-affiliate— 1,000 — — (1,000)— 
Accounts payable111,024 26,139 22,844 — — 160,007 
Interest and preferred dividends payable12,442 2,617 2,269 — (3)17,325 
Taxes accrued, including revenue taxes143,723 33,153 30,679 — 725 208,280 
Regulatory liabilities22,240 3,247 4,273 — — 29,760 
Other56,752 14,158 18,540 — (17,881)71,569 
Total current liabilities432,117 95,686 78,640 — (18,159)588,284 
Deferred credits and other liabilities     
Operating lease liabilities46,426 19,063 291 — — 65,780 
Deferred income taxes291,027 53,298 64,309 — — 408,634 
Regulatory liabilities695,152 179,267 92,589 — — 967,008 
Unamortized tax credits76,201 14,212 13,532 — — 103,945 
Defined benefit pension and other postretirement benefit plans liability
220,480 48,900 53,257 — (857)321,780 
Other67,511 18,030 30,042 — (8)115,575 
Total deferred credits and other liabilities1,396,797 332,770 254,020 — (865)1,982,722 
Total capitalization and liabilities$5,249,726 1,002,746 934,337 77 (695,261)$6,491,625 

23

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - continued (Unaudited)

Hawaiian Electric Company, Inc. and Subsidiaries
Condensed Consolidating Statement of Changes in Common Stock Equity
Three months ended March 31, 2022
(in thousands)Hawaiian ElectricHawaii Electric LightMaui ElectricOther
subsidiaries		Consolidating
adjustments		Hawaiian Electric
Consolidated
Balance, December 31, 2021$2,261,899 332,900 343,260 77 (676,237)$2,261,899 
Net income for common stock46,409 7,377 6,284 — (13,661)46,409 
Other comprehensive income, net of taxes51 — — — — 51 
Common stock dividends(31,475)(4,100)(3,800)— 7,900 (31,475)
Balance, March 31, 2022$2,276,884 336,177 345,744 77 (681,998)$2,276,884 
 
Hawaiian Electric Company, Inc. and Subsidiaries
Condensed Consolidating Statement of Changes in Common Stock Equity
Three months ended March 31, 2021
(in thousands)Hawaiian ElectricHawaii Electric LightMaui ElectricOther
subsidiaries		Consolidating
adjustments		Hawaiian Electric
Consolidated
Balance, December 31, 2020$2,141,918 317,451 309,363 77 (626,891)$2,141,918 
Net income for common stock43,358 6,692 5,818 — (12,510)43,358 
Other comprehensive income, net of taxes34 1 — — (1)34 
Common stock dividends(27,925)(3,650)(3,776)— 7,426 (27,925)
Balance, March 31, 2021$2,157,385 320,494 311,405 77 (631,976)$2,157,385 

24

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - continued (Unaudited)

Hawaiian Electric Company, Inc. and Subsidiaries
Condensed Consolidating Statement of Cash Flows
Three months ended March 31, 2022
(in thousands)Hawaiian ElectricHawaii Electric LightMaui ElectricOther
subsidiaries		Consolidating
adjustments		Hawaiian Electric
Consolidated
Net cash provided by operating activities$55,669 15,778 13,228 — (7,900)$76,775 
Cash flows from investing activities      
Capital expenditures(44,084)(15,133)(17,141)— — (76,358)
Advances to affiliates(4,000)— (12,800)— 16,800 — 
Other961 280 253 — — 1,494 
Net cash used in investing activities(47,123)(14,853)(29,688)— 16,800 (74,864)
Cash flows from financing activities      
Common stock dividends(31,475)(4,100)(3,800)— 7,900 (31,475)
Preferred stock dividends of Hawaiian Electric and subsidiaries(270)(134)(95)— — (499)
Net increase in short-term borrowings from non-affiliates and affiliate with original maturities of three months or less18,800 4,000 — — (16,800)6,000 
Net cash used in financing activities(12,945)(234)(3,895)— (8,900)(25,974)
Net increase (decrease) in cash and cash equivalents(4,399)691 (20,355)— — (24,063)
Cash, cash equivalents and restricted cash, beginning of period26,433 5,326 23,422 77 — 55,258 
Cash, cash equivalents and restricted cash, end of period22,034 6,017 3,067 77 — 31,195 
Less: Restricted cash(2,140)— — — — (2,140)
Cash and cash equivalents, end of period$19,894 6,017 3,067 77 — $29,055 

25

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - continued (Unaudited)

Hawaiian Electric Company, Inc. and Subsidiaries
Condensed Consolidating Statement of Cash Flows
Three months ended March 31, 2021
(in thousands)Hawaiian ElectricHawaii Electric LightMaui ElectricOther
subsidiaries		Consolidating
adjustments		Hawaiian Electric
Consolidated
Net cash provided by operating activities$18,764 9,635 10,988 — (7,426)$31,961 
Cash flows from investing activities     
Capital expenditures (45,293)(12,728)(12,340)— — (70,361)
Advances from affiliates26,700 — — — (26,700)— 
Other1,182 372 309 — — 1,863 
Net cash used in investing activities(17,411)(12,356)(12,031)— (26,700)(68,498)
Cash flows from financing activities     
Common stock dividends(27,925)(3,650)(3,776)— 7,426 (27,925)
Preferred stock dividends of Hawaiian Electric and subsidiaries(270)(134)(95)— — (499)
Repayment of short-term debt(50,000)— — — — (50,000)
Proceeds from issuance of long-term debt60,000 30,000 25,000 — — 115,000 
Net decrease in short-term borrowings from non-affiliates and affiliate with original maturities of three months or less— (18,800)(7,900)— 26,700 — 
Other(96)(11)(9)— — (116)
Net cash provided by (used in) financing activities(18,291)7,405 13,220 — 34,126 36,460 
Net increase (decrease) in cash and cash equivalents(16,938)4,684 12,177 — — (77)
Cash, cash equivalents and restricted cash, beginning of period58,171 3,046 2,032 77 — 63,326 
Cash, cash equivalents and restricted cash, end of period41,233 7,730 14,209 77 — 63,249 
Less: Restricted cash(11,506)— — — — (11,506)
Cash and cash equivalents, end of period$29,727 7,730 14,209 77 — $51,743 

26

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - continued (Unaudited)
Note 4 · Bank segment
Selected financial information
American Savings Bank, F.S.B.
Statements of Income and Comprehensive Income Data
 Three months ended March 31
(in thousands)20222021
Interest and dividend income  
Interest and fees on loans$46,005 $49,947 
Interest and dividends on investment securities13,984 8,673 
Total interest and dividend income59,989 58,620 
Interest expense  
Interest on deposit liabilities947 1,462 
Interest on other borrowings5 27 
Total interest expense952 1,489 
Net interest income59,037 57,131 
Provision for credit losses(3,263)(8,435)
Net interest income after provision for credit losses62,300 65,566 
Noninterest income  
Fees from other financial services5,587 5,073 
Fee income on deposit liabilities4,691 3,863 
Fee income on other financial products2,718 2,442 
Bank-owned life insurance681 2,561 
Mortgage banking income1,077 4,300 
Gain on sale of real estate1,002 — 
Gain on sale of investment securities, net— 528 
Other income, net372 272 
Total noninterest income16,128 19,039 
Noninterest expense  
Compensation and employee benefits27,215 28,037 
Occupancy5,952 4,969 
Data processing4,151 4,351 
Services2,439 2,862 
Equipment2,329 2,222 
Office supplies, printing and postage1,060 1,044 
Marketing1,018 648 
FDIC insurance808 816 
Other expense3,241 2,554 
Total noninterest expense48,213 47,503 
Income before income taxes30,215 37,102 
Income taxes6,345 7,546 
Net income23,870 29,556 
Other comprehensive loss, net of tax benefits(122,441)(45,754)
Comprehensive income (loss)$(98,571)$(16,198)

27

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - continued (Unaudited)

Reconciliation to amounts per HEI Condensed Consolidated Statements of Income*:
 Three months ended March 31
(in thousands)20222021
Interest and dividend income$59,989 $58,620 
Noninterest income16,128 19,039 
Less: Gain on sale of real estate1,002 — 
Less: Gain on sale of investment securities, net— 528 
*Revenues-Bank75,115 77,131 
Total interest expense952 1,489 
Provision for credit losses(3,263)(8,435)
Noninterest expense48,213 47,503 
Less: Gain on sale of real estate1,002 — 
Less: Retirement defined benefits credit—other than service costs(185)(1,278)
*Expenses-Bank45,085 41,835 
*Operating income-Bank30,030 35,296 
Add back: Retirement defined benefits credit—other than service costs(185)(1,278)
Add back: Gain on sale of investment securities, net— 528 
Income before income taxes$30,215 $37,102 


28

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - continued (Unaudited)
American Savings Bank, F.S.B.
Balance Sheets Data
(in thousands)March 31, 2022December 31, 2021
Assets    
Cash and due from banks $114,249  $100,051 
Interest-bearing deposits155,279 151,189 
Cash and cash equivalents269,528 251,240 
Investment securities
Available-for-sale, at fair value 2,621,375  2,574,618 
Held-to-maturity, at amortized cost (fair value of $466,236 and $510,474, respectively)
517,150 522,270 
Stock in Federal Home Loan Bank, at cost 10,000  10,000 
Loans held for investment 5,184,733  5,211,114 
Allowance for credit losses (67,211) (71,130)
Net loans 5,117,522  5,139,984 
Loans held for sale, at lower of cost or fair value 7,961  10,404 
Other 626,599  590,897 
Goodwill 82,190  82,190 
Total assets $9,252,325  $9,181,603 
Liabilities and shareholder’s equity    
Deposit liabilities—noninterest-bearing $3,016,520  $2,976,632 
Deposit liabilities—interest-bearing 5,272,752  5,195,580 
Other borrowings 137,385  88,305 
Other 210,681  193,268 
Total liabilities 8,637,338  8,453,785 
  
Common stock 1  1 
Additional paid-in capital354,635 353,895 
Retained earnings 420,574  411,704 
Accumulated other comprehensive loss, net of tax benefits    
Net unrealized losses on securities$(152,444) $(32,037)
Retirement benefit plans(7,779)(160,223)(5,745)(37,782)
Total shareholder’s equity614,987  727,818 
Total liabilities and shareholder’s equity $9,252,325  $9,181,603 
Other assets    
Bank-owned life insurance $176,301  $177,566 
Premises and equipment, net 199,949  202,299 
Accrued interest receivable 21,133  20,854 
Mortgage-servicing rights 10,024  9,950 
Low-income housing investments107,791 110,989 
Deferred tax asset51,720 7,699 
Other 59,681  61,540 
  $626,599  $590,897 
Other liabilities    
Accrued expenses $104,958  $87,905 
Federal and state income taxes payable 2,174  — 
Cashier’s checks 36,586  33,675 
Advance payments by borrowers 5,664  9,994 
Other 61,299  61,694 
  $210,681  $193,268 
    
29

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - continued (Unaudited)
Bank-owned life insurance is life insurance purchased by ASB on the lives of certain key employees, with ASB as the beneficiary. The insurance is used to fund employee benefits through tax-free income from increases in the cash value of the policies and insurance proceeds paid to ASB upon an insured’s death.
Other borrowings consisted of securities sold under agreements to repurchase of $137.4 million and $88.3 million at March 31, 2022 and December 31, 2021, respectively.
Investment securities.  The major components of investment securities were as follows:
 Amortized costGross unrealized gainsGross unrealized lossesEstimated fair
value		Gross unrealized losses
 Less than 12 months12 months or longer
(dollars in thousands)Number of issuesFair 
value		AmountNumber of issuesFair 
value		Amount
March 31, 2022        
Available-for-sale
U.S. Treasury and federal agency obligations$109,343 $75 $(3,216)$106,202 16 $91,087 $(3,216)— $— $— 
Mortgage-backed securities*2,660,506 277 (204,029)2,456,754 165 1,484,883 (97,460)64 904,628 (106,569)
Corporate bonds44,481 101 (1,459)43,123 3 34,014 (1,459)— — — 
Mortgage revenue bonds15,296 — — 15,296 — — — — — — 
 $2,829,626 $453 $(208,704)$2,621,375 184 $1,609,984 $(102,135)64 $904,628 $(106,569)
Held-to-maturity
U.S. Treasury and Federal agency obligations$59,877 $— $(3,831)$56,046 3 $56,046 $(3,831)— $— $— 
Mortgage-backed securities*457,273 76 (47,159)410,190 23 246,986 (23,964)13 158,370 (23,195)
 $517,150 $76 $(50,990)$466,236 26 $303,032 $(27,795)13 $158,370 $(23,195)
December 31, 2021
Available-for-sale
U.S. Treasury and federal agency obligations$89,714 $803 $(427)$90,090 4 $44,827 $(427)— $— $— 
Mortgage-backed securities*2,482,618 6,511 (51,206)2,437,923 120 1,845,243 (38,321)18 271,012 (12,885)
Corporate bonds30,625 655 (102)31,178 1 12,780 (102)— — — 
Mortgage revenue bonds15,427 — — 15,427 — — — — — — 
 $2,618,384 $7,969 $(51,735)$2,574,618 125 $1,902,850 $(38,850)18 $271,012 $(12,885)
Held-to-maturity
U.S. Treasury and Federal agency obligations$59,871 $168 $(170)$59,869 2 $39,594 $(170)— $— $— 
Mortgage-backed securities* 462,399 1,480 (13,274)450,605 22 290,883 (7,665)7 106,483 (5,609)
 $522,270 $1,648 $(13,444)$510,474 24 $330,477 $(7,835)7 $106,483 $(5,609)
* Issued or guaranteed by U.S. Government agencies or sponsored agencies
ASB does not believe that the investment securities that were in an unrealized loss position at March 31, 2022 and December 31, 2021, represent a credit loss. Total gross unrealized losses were primarily attributable to change in market conditions. On a quarterly basis the investment securities are evaluated for changes in financial condition of the issuer. Based upon ASB’s evaluation, all securities held within the investment portfolio continue to be investment grade by one or more agencies. The contractual cash flows of the U.S. Treasury, federal agency obligations and agency mortgage-backed securities are backed by the full faith and credit guaranty of the United States government or an agency of the government. ASB does not intend to sell the securities before the recovery of its amortized cost basis and there have been no adverse changes in the timing of the contractual cash flows for the securities. ASB’s investment securities portfolio did not require an allowance for credit losses at March 31, 2022 and December 31, 2021.
U.S. Treasury, federal agency obligations, corporate bonds, and mortgage revenue bonds have contractual terms to maturity. Mortgage-backed securities have contractual terms to maturity, but require periodic payments to reduce principal.
30

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - continued (Unaudited)
In addition, expected maturities will differ from contractual maturities because borrowers have the right to prepay the underlying mortgages.
The contractual maturities of investment securities were as follows:
March 31, 2022Amortized costFair value
(in thousands)  
Available-for-sale
Due in one year or less$15,821 $15,890 
Due after one year through five years81,524 79,931 
Due after five years through ten years71,775 68,800 
Due after ten years— — 
 169,120 164,621 
Mortgage-backed securities — issued or guaranteed by U.S. Government agencies or sponsored agencies2,660,506 2,456,754 
Total available-for-sale securities$2,829,626 $2,621,375 
Held-to-maturity
Due in one year or less$— $— 
Due after one year through five years— — 
Due after five years through ten years59,877 56,046 
Due after ten years— — 
59,877 56,046 
Mortgage-backed securities — issued or guaranteed by U.S. Government agencies or sponsored agencies457,273 410,190 
Total held-to-maturity securities$517,150 $466,236 
The proceeds, gross gains and losses from sales of available-for-sale securities were as follows:
Three months ended March 31
20222021
(in thousands)
Proceeds $— $197,354 
Gross gains — 974 
Gross losses— 446 
Tax expense on realized gains— 142 
The components of loans were summarized as follows:
March 31, 2022December 31, 2021
(in thousands)  
Real estate:  
Residential 1-4 family$2,279,671 $2,299,212 
Commercial real estate1,115,632 1,056,982 
Home equity line of credit845,271 835,663 
Residential land22,309 19,859 
Commercial construction90,332 91,080 
Residential construction15,508 11,138 
Total real estate4,368,723 4,313,934 
Commercial708,447 793,304 
Consumer116,090 113,966 
Total loans5,193,260 5,221,204 
Less: Deferred fees and discounts(8,527)(10,090)
Allowance for credit losses (67,211)(71,130)
Total loans, net$5,117,522 $5,139,984 
31

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - continued (Unaudited)
ASB's policy is to require private mortgage insurance on all real estate loans when the loan-to-value ratio of the property exceeds 80% of the lower of the appraised value or purchase price at origination. For non-owner occupied residential property purchases, the loan-to-value ratio may not exceed 75% of the lower of the appraised value or purchase price at origination.
Allowance for credit losses.  The allowance for credit losses (balances and changes) by portfolio segment were as follows:
(in thousands)Residential
1-4 family		Commercial real
estate		Home
equity line of credit		Residential landCommercial constructionResidential constructionCommercial loansConsumer loansTotal
Three months ended March 31, 2022        
Allowance for credit losses:         
Beginning balance$6,545 $24,696 $5,657 $646 $2,186 $18 $15,798 $15,584 $71,130 
Charge-offs— — — — — — (76)(1,482)(1,558)
Recoveries8 — 11 5 — — 353 1,025 1,402 
Provision1,321 (4,520)(18)46 154 13 (1,761)1,002 (3,763)
Ending balance$7,874 $20,176 $5,650 $697 $2,340 $31 $14,314 $16,129 $67,211 
Three months ended March 31, 2021        
Allowance for credit losses:         
Beginning balance$4,600 $35,607 $6,813 $609 $4,149 $11 $25,462 $23,950 $101,201 
Charge-offs— — (50)— — — (771)(2,860)(3,681)
Recoveries3 — 15 10 — — 273 1,007 1,308 
Provision658 (1,262)(877)(46)(2,696)5 (460)(2,357)(7,035)
Ending balance$5,261 $34,345 $5,901 $573 $1,453 $16 $24,504 $19,740 $91,793 

Allowance for loan commitments.  The allowance for loan commitments by portfolio segment were as follows:
(in thousands)Home equity
 line of credit		Commercial constructionCommercial loansTotal
Three months ended March 31, 2022
Allowance for loan commitments:
Beginning balance$400 $3,700 $800 $4,900 
Provision— (100)600 500 
Ending balance$400 $3,600 $1,400 $5,400 
Three months ended March 31, 2021
Allowance for loan commitments:
Beginning balance$300 $3,000 $1,000 $4,300 
Provision100 (1,700)200 (1,400)
Ending balance$400 $1,300 $1,200 $2,900 
Credit quality.  ASB performs an internal loan review and grading on an ongoing basis. The review provides management with periodic information as to the quality of the loan portfolio and effectiveness of its lending policies and procedures. The objectives of the loan review and grading procedures are to identify, in a timely manner, existing or emerging credit trends so that appropriate steps can be initiated to manage risk and avoid or minimize future losses. Loans subject to grading include commercial, commercial real estate and commercial construction loans.
Each commercial and commercial real estate loan is assigned an Asset Quality Rating (AQR) reflecting the likelihood of repayment or orderly liquidation of that loan transaction pursuant to regulatory credit classifications:  Pass, Special Mention, Substandard, Doubtful, and Loss. The AQR is a function of the probability of default model rating, the loss given default, and possible non-model factors which impact the ultimate collectability of the loan such as character of the business owner/guarantor, interim period performance, litigation, tax liens and major changes in business and economic conditions. Pass exposures generally are well protected by the current net worth and paying capacity of the obligor or by the value of the asset or underlying collateral. Special Mention loans have potential weaknesses that, if left uncorrected, could jeopardize the liquidation of the debt. Substandard loans have well-defined weaknesses that jeopardize the liquidation of the debt and are characterized by the distinct possibility that ASB may sustain some loss. An asset classified Doubtful has the weaknesses of those classified Substandard, with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable. An asset classified Loss is considered uncollectible and has such little value that its continuance as a bankable asset is not warranted.
32

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - continued (Unaudited)
The credit risk profile by vintage date based on payment activity or internally assigned grade for loans was as follows:
Term Loans by Origination YearRevolving Loans
(in thousands)20222021202020192018PriorRevolvingConverted to term loansTotal
March 31, 2022
Residential 1-4 family
Current$77,374 $779,764 $448,738 $125,136 $58,967 $781,055 $— $— $2,271,034 
30-59 days past due— — — — — 1,920 — — 1,920 
60-89 days past due— — — — — 2,414 — — 2,414 
Greater than 89 days past due— — — — 809 3,494 — — 4,303 
77,374 779,764 448,738 125,136 59,776 788,883 — — 2,279,671 
Home equity line of credit
Current— — — — — — 803,515 39,683 843,198 
30-59 days past due— — — — — — 457 512 969 
60-89 days past due— — — — — — 64 — 64 
Greater than 89 days past due— — — — — — 745 295 1,040 
— — — — — — 804,781 40,490 845,271 
Residential land
Current2,703 10,550 6,725 958 530 446 — — 21,912 
30-59 days past due— — — — — — — — — 
60-89 days past due— — — — — — — — — 
Greater than 89 days past due— — — — — 397 — — 397 
2,703 10,550 6,725 958 530 843 — — 22,309 
Residential construction
Current2,423 10,493 2,336 — — 256 — — 15,508 
30-59 days past due— — — — — — — — — 
60-89 days past due— — — — — — — — — 
Greater than 89 days past due— — — — — — — — — 
2,423 10,493 2,336 — — 256 — — 15,508 
Consumer
Current22,938 32,765 12,643 22,292 6,434 318 11,886 4,163 113,439 
30-59 days past due185 187 126 377 170 2 96 35 1,178 
60-89 days past due— 56 115 278 97 4 23 48 621 
Greater than 89 days past due— 43 55 253 200 9 111 181 852 
23,123 33,051 12,939 23,200 6,901 333 12,116 4,427 116,090 
Commercial real estate
Pass72,390 171,541 292,533 53,006 61,639 296,669 4,235 — 952,013 
Special Mention— 19,600 3,508 41,925 14,250 43,372 — — 122,655 
Substandard— — 678 11,238 1,847 27,201 — — 40,964 
Doubtful— — — — — — — — — 
72,390 191,141 296,719 106,169 77,736 367,242 4,235 — 1,115,632 
Commercial construction
Pass119 22,614 32,846 — 11,341 — 23,412 — 90,332 
Special Mention— — — — — — — — — 
Substandard— — — — — — — — — 
Doubtful— — — — — — — — — 
119 22,614 32,846 — 11,341 — 23,412 — 90,332 
Commercial
Pass8,521 234,161 83,927 75,241 46,058 89,119 89,919 14,951 641,897 
Special Mention— 31 10,012 9,540 117 7,680 18,364 17 45,761 
Substandard— 423 173 3,110 1,686 6,759 7,326 1,312 20,789 
Doubtful— — — — — — — — — 
8,521 234,615 94,112 87,891 47,861 103,558 115,609 16,280 708,447 
Total loans$186,653 $1,282,228 $894,415 $343,354 $204,145 $1,261,115 $960,153 $61,197 $5,193,260 
33

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - continued (Unaudited)
Term Loans by Origination YearRevolving Loans
(in thousands)20212020201920182017PriorRevolvingConverted to term loansTotal
December 31, 2021
Residential 1-4 family
Current$791,758 $461,683 $133,345 $64,421 $124,994 $712,452 $— $— $2,288,653 
30-59 days past due— — — 809 — 2,210 — — 3,019 
60-89 days past due— — — — — 1,468 — — 1,468 
Greater than 89 days past due— — 2,987 — — 3,085 — — 6,072 
791,758 461,683 136,332 65,230 124,994 719,215 — — 2,299,212 
Home equity line of credit
Current— — — — — — 794,518 39,116 833,634 
30-59 days past due— — — — — — 296 313 609 
60-89 days past due— — — — — — 16 70 86 
Greater than 89 days past due— — — — — — 838 496 1,334 
— — — — — — 795,668 39,995 835,663 
Residential land
Current10,572 6,794 1,116 532 267 181 — — 19,462 
30-59 days past due— — — — — — — — — 
60-89 days past due— — — — — — — — — 
Greater than 89 days past due— — — — — 397 — — 397 
10,572 6,794 1,116 532 267 578 — — 19,859 
Residential construction
Current7,856 3,019 — — 263 — — — 11,138 
30-59 days past due— — — — — — — — — 
60-89 days past due— — — — — — — — — 
Greater than 89 days past due— — — — — — — — — 
7,856 3,019 — — 263 — — — 11,138 
Consumer
Current37,563 15,488 29,383 10,897 302 238 12,740 4,157 110,768 
30-59 days past due202 181 517 234 15 — 156 70 1,375 
60-89 days past due59 127 392 183 8 — 7 106 882 
Greater than 89 days past due14 93 387 192 27 — 141 87 941 
37,838 15,889 30,679 11,506 352 238 13,044 4,420 113,966 
Commercial real estate
Pass173,794 275,242 49,317 56,490 33,581 259,583 11,602 — 859,609 
Special Mention19,600 3,529 42,935 30,870 20,788 32,824 — — 150,546 
Substandard— 684 13,936 1,859 1,805 28,543 — — 46,827 
Doubtful— — — — — — — — — 
193,394 279,455 106,188 89,219 56,174 320,950 11,602 — 1,056,982 
Commercial construction
Pass17,140 43,261 — 11,342 — — 19,337 — 91,080 
Special Mention— — — — — — — — — 
Substandard— — — — — — — — — 
Doubtful— — — — — — — — — 
17,140 43,261 — 11,342 — — 19,337 — 91,080 
Commercial
Pass266,087 96,963 79,329 56,497 31,019 66,570 96,673 15,510 708,648 
Special Mention40 27,336 10,071 202 439 8,966 15,303 18 62,375 
Substandard427 184 3,737 1,777 4,457 2,961 7,083 1,655 22,281 
Doubtful— — — — — — — — — 
266,554 124,483 93,137 58,476 35,915 78,497 119,059 17,183 793,304 
Total loans$1,325,112 $934,584 $367,452 $236,305 $217,965 $1,119,478 $958,710 $61,598 $5,221,204 
34

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - continued (Unaudited)
Revolving loans converted to term loans during the three months ended March 31, 2022 in the commercial, home equity line of credit and consumer portfolios were $0.5 million, $4.4 million and $1.0 million, respectively. Revolving loans converted to term loans during the three months ended March 31, 2021 in the commercial, home equity line of credit and consumer portfolios were $0.5 million, $6.2 million and $0.7 million, respectively.
The credit risk profile based on payment activity for loans was as follows:
(in thousands)30-59
days
past due		60-89
days
past due		 
Greater than
90 days		Total
past due		CurrentTotal
financing
receivables		Amortized cost>
90 days and
accruing
March 31, 2022       
Real estate:       
Residential 1-4 family$1,920 $2,414 $4,303 $8,637 $2,271,034 $2,279,671 $— 
Commercial real estate— — — — 1,115,632 1,115,632 — 
Home equity line of credit969 64 1,040 2,073 843,198 845,271 — 
Residential land— — 397 397 21,912 22,309 — 
Commercial construction— — — — 90,332 90,332 — 
Residential construction— — — — 15,508 15,508 — 
Commercial200 139 40 379 708,068 708,447 — 
Consumer1,178 621 852 2,651 113,439 116,090 — 
Total loans$4,267 $3,238 $6,632 $14,137 $5,179,123 $5,193,260 $— 
December 31, 2021       
Real estate:       
Residential 1-4 family$3,019 $1,468 $6,072 $10,559 $2,288,653 $2,299,212 $— 
Commercial real estate— — — — 1,056,982 1,056,982 — 
Home equity line of credit609 86 1,334 2,029 833,634 835,663 — 
Residential land— — 397 397 19,462 19,859 — 
Commercial construction— — — — 91,080 91,080 — 
Residential construction— — — — 11,138 11,138 — 
Commercial700 313 48 1,061 792,243 793,304 — 
Consumer1,375 882 941 3,198 110,768 113,966 — 
Total loans$5,703 $2,749 $8,792 $17,244 $5,203,960 $5,221,204 $— 
The credit risk profile based on nonaccrual loans were as follows:
(in thousands)March 31, 2022December 31, 2021
With a Related ACLWithout a Related ACLTotalWith a Related ACLWithout a Related ACLTotal
Real estate:
Residential 1-4 family$12,583 $3,909 $16,492 $16,045 $3,703 $19,748 
Commercial real estate— 12,530 12,530 14,104 1,221 15,325 
Home equity line of credit3,371 1,054 4,425 4,227 1,294 5,521 
Residential land— 397 397 97 300 397 
Commercial construction— — — — — — 
Residential construction— — — — — — 
Commercial 1,307 562 1,869 1,446 692 2,138 
Consumer 1,555 — 1,555 1,845 — 1,845 
  Total $18,816 $18,452 $37,268 $37,764 $7,210 $44,974 

35

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - continued (Unaudited)
The credit risk profile based on loans whose terms have been modified and accruing interest were as follows:
(in thousands)March 31, 2022December 31, 2021
Real estate:
Residential 1-4 family$7,296 $6,949 
Commercial real estate2,888 3,055 
Home equity line of credit5,437 6,021 
Residential land976 980 
Commercial construction— — 
Residential construction— — 
Commercial7,079 7,860 
Consumer52 52 
Total troubled debt restructured loans accruing interest$23,728 $24,917 
ASB did not recognize interest on nonaccrual loans for the three months ended March 31, 2022 and 2021.
Troubled debt restructurings.  A loan modification is deemed to be a TDR when the borrower is determined to be experiencing financial difficulties and ASB grants a concession it would not otherwise consider.
The allowance for credit losses on TDR loans that do not share risk characteristics are individually evaluated based on the present value of expected future cash flows discounted at the loan’s effective original contractual rate or based on the fair value of collateral less cost to sell. The financial impact of the estimated loss is an increase to the allowance associated with the modified loan. When available information confirms that specific loans or portions thereof are uncollectible (confirmed losses), these amounts are charged off against the allowance for credit losses.
There were no loan modifications that occurred during the three months ended March 31, 2022. Loan modifications that occurred during the three months ended March 31, 2021 were as follows:
Three months ended March 31, 2021
(dollars in thousands)Number 
of contracts
Outstanding recorded investment
 (as of period end)1
Related allowance
(as of period end)
Troubled debt restructurings  
Real estate:  
Residential 1-4 family12 $8,283 $298 
Commercial real estate1 482 — 
Home equity line of credit1 170 21 
Residential land1 271 11 
Commercial construction— — — 
Residential construction— — — 
Commercial2 59 19 
Consumer — — — 
 17 $9,265 $349 
1 The period end balances reflect all paydowns and charge-offs since the modification period. TDRs fully paid off, charged-off, or foreclosed upon by period end are not included.

There were no loans modified in TDRs that experienced a payment default of 90 days or more during the first three months of 2022 and 2021.
If a loan modified in a TDR subsequently defaults, ASB evaluates the loan for further impairment. Based on its evaluation, adjustments may be made in the allocation of the allowance or partial charge-offs may be taken to further write-down the carrying value of the loan. Commitments to lend additional funds to borrowers whose loan terms have been modified in a TDR totaled nil at March 31, 2022 and December 31, 2021.
The Coronavirus Aid, Relief, and Economic Security Act (CARES Act) provides that a financial institution may elect to suspend the requirements under GAAP for certain loan modifications that would otherwise be categorized as a TDR and any related impairment for accounting purposes.
36

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - continued (Unaudited)
In response to the COVID-19 pandemic, the Board of Governors of the FRB, the FDIC, the National Credit Union Administration, the OCC, and the Consumer Financial Protection Bureau, in consultation with the state financial regulators (collectively, the “agencies”) issued a joint interagency statement (issued March 22, 2020; revised statement issued April 7, 2020). Some of the provisions applicable to the Company include, but are not limited to accounting for loan modifications, past due reporting and nonaccrual status and charge-offs.
Loan modifications that do not meet the conditions of the CARES Act may still qualify as a modification that does not need to be accounted for as a TDR. The agencies confirmed with the FASB staff that short-term modifications made on a good faith basis in response to COVID-19 to borrowers who were current prior to any relief are not TDRs. This includes short-term (e.g., six months) modifications such as payment deferrals, fee waivers, extensions of repayment terms, or insignificant delays in payment. Financial institutions are not expected to designate loans with deferrals granted due to COVID-19 as past due because of the deferral. A loan’s payment date is governed by the due date stipulated in the legal agreement. If a financial institution agrees to a payment deferral, these loans would not be considered past due during the period of the deferral. Lastly, during short-term COVID-19 modifications, these loans generally should not be reported as nonaccrual or as classified.
Collateral-dependent loans. A loan is considered collateral-dependent when the borrower is experiencing financial difficulty and repayment of the loan is expected to be provided substantially through the operation or sale of the collateral. Loans considered collateral-dependent were as follows:
Amortized cost
(in thousands)March 31, 2022December 31, 2021Collateral type
Real estate:
   Residential 1-4 family$4,500 $3,493  Residential real estate property
Commercial real estate1,200 1,221  Commercial real estate property
   Home equity line of credit1,034 1,294  Residential real estate property
Residential land397 300  Residential real estate property
     Total real estate7,131 6,308 
Commercial562 692  Business assets
     Total $7,693 $7,000 
ASB had $4.0 million and $3.4 million of mortgage loans collateralized by residential real estate property that were in the process of foreclosure at March 31, 2022 and December 31, 2021, respectively.
Mortgage servicing rights (MSRs). In its mortgage banking business, ASB sells residential mortgage loans to government-sponsored entities and other parties, who may issue securities backed by pools of such loans. ASB retains no beneficial interests in these loans other than the servicing rights of certain loans sold.
ASB received proceeds from the sale of residential mortgages of $75.6 million and $170.9 million for the three months ended March 31, 2022 and 2021, respectively, and recognized gains on such sales of $1.1 million and $4.3 million for the three months ended March 31, 2022 and 2021, respectively.
There were no repurchased mortgage loans for the three months ended March 31, 2022 and 2021.
Mortgage servicing fees, a component of other income, net, were $0.9 million for both the three months ended March 31, 2022 and 2021.
Changes in the carrying value of MSRs were as follows:
(in thousands)Gross
carrying amount		Accumulated amortizationValuation allowanceNet
carrying amount
March 31, 2022$19,137 $(9,113)$— $10,024 
December 31, 202118,674 (8,724)— 9,950 

37

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - continued (Unaudited)
Changes related to MSRs were as follows:
Three months ended March 31
(in thousands)20222021
Mortgage servicing rights
Beginning balance$9,950 $10,280 
Amount capitalized719 1,547 
Amortization(645)(1,138)
Other-than-temporary impairment— — 
Carrying amount before valuation allowance10,024 10,689 
Valuation allowance for mortgage servicing rights
Beginning balance— 260 
Provision— (256)
Other-than-temporary impairment— — 
Ending balance— 4 
Net carrying value of mortgage servicing rights$10,024 $10,685 
ASB capitalizes MSRs acquired upon the sale of mortgage loans with servicing rights retained. On a monthly basis, ASB compares the net carrying value of the MSRs to its fair value to determine if there are any changes to the valuation allowance and/or other-than-temporary impairment for the MSRs.
ASB uses a present value cash flow model to estimate the fair value of MSRs. Impairment is recognized through a valuation allowance for each stratum when the carrying amount exceeds fair value, with any associated provision recorded as a component of loan servicing fees included in “Revenues - bank” in the condensed consolidated statements of income. A direct write-down is recorded when the recoverability of the valuation allowance is deemed to be unrecoverable.
Key assumptions used in estimating the fair value of ASB’s MSRs used in the impairment analysis were as follows:
(dollars in thousands)March 31, 2022December 31, 2021
Unpaid principal balance$1,488,591 $1,481,899 
Weighted average note rate3.34 %3.38 %
Weighted average discount rate9.25 %9.25 %
Weighted average prepayment speed7.06 %9.77 %

The sensitivity analysis of fair value of MSRs to hypothetical adverse changes of 25 and 50 basis points in certain key assumptions was as follows:
(dollars in thousands)March 31, 2022December 31, 2021
Prepayment rate:
  25 basis points adverse rate change$(360)$(714)
  50 basis points adverse rate change(809)(1,608)
Discount rate:
  25 basis points adverse rate change(160)(129)
  50 basis points adverse rate change(318)(256)
The effect of a variation in certain assumptions on fair value is calculated without changing any other assumptions. This analysis typically cannot be extrapolated because the relationship of a change in one key assumption to the changes in the fair value of MSRs typically is not linear.
Other borrowings.  As of March 31, 2022 and December 31, 2021, ASB had no FHLB advances outstanding or federal funds purchased with the Federal Reserve Bank. ASB was in compliance with all Advances, Pledge and Security Agreement requirements as of March 31, 2022.
Securities sold under agreements to repurchase are accounted for as financing transactions and the obligations to repurchase these securities are recorded as liabilities in the condensed consolidated balance sheets. ASB pledges investment securities as collateral for securities sold under agreements to repurchase. All such agreements are subject to master netting
38

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - continued (Unaudited)
arrangements, which provide for a conditional right of set-off in case of default by either party; however, ASB presents securities sold under agreements to repurchase on a gross basis in the balance sheet. The following tables present information about the securities sold under agreements to repurchase, including the related collateral received from or pledged to counterparties:
(in millions)Gross amount
 of recognized
 liabilities		Gross amount
 offset in the 
Balance Sheets		Net amount of
liabilities presented
in the Balance Sheets
Repurchase agreements   
March 31, 2022$137 $— $137 
December 31, 202188 — 88 
 Gross amount not offset in the Balance Sheets
(in millions) Net amount of liabilities presented
in the Balance Sheets		Financial
instruments		Cash
collateral
pledged
Commercial account holders
March 31, 2022$137 $161 $— 
December 31, 202188 161 — 
The securities underlying the agreements to repurchase are book-entry securities and were delivered by appropriate entry into the counterparties’ accounts or into segregated tri-party custodial accounts at the FHLB. The securities underlying the agreements to repurchase continue to be reflected in ASB’s asset accounts.
Derivative financial instruments. ASB enters into interest rate lock commitments (IRLCs) with borrowers, and forward commitments to sell loans or to-be-announced mortgage-backed securities to investors to hedge against the inherent interest rate and pricing risks associated with selling loans.
ASB enters into IRLCs for residential mortgage loans, which commit ASB to lend funds to a potential borrower at a specific interest rate and within a specified period of time. IRLCs that relate to the origination of mortgage loans that will be held for sale are considered derivative financial instruments under applicable accounting guidance. Outstanding IRLCs expose ASB to the risk that the price of the mortgage loans underlying the commitments may decline due to increases in mortgage interest rates from inception of the rate lock to the funding of the loan. The IRLCs are free-standing derivatives which are carried at fair value with changes recorded in mortgage banking income.
ASB enters into forward commitments to hedge the interest rate risk for rate locked mortgage applications in process and closed mortgage loans held for sale. These commitments are primarily forward sales of to-be-announced mortgage backed securities. Generally, when mortgage loans are closed, the forward commitment is liquidated and replaced with a mandatory delivery forward sale of the mortgage to a secondary market investor. In some cases, a best-efforts forward sale agreement is utilized as the forward commitment. These commitments are free-standing derivatives which are carried at fair value with changes recorded in mortgage banking income.
Changes in the fair value of IRLCs and forward commitments subsequent to inception are based on changes in the fair value of the underlying loan resulting from the fulfillment of the commitment and changes in the probability that the loan will fund within the terms of the commitment, which is affected primarily by changes in interest rates and the passage of time.
The notional amount and fair value of ASB’s derivative financial instruments were as follows:
 March 31, 2022December 31, 2021
(in thousands)Notional amountFair valueNotional amountFair value
Interest rate lock commitments$12,342 $(18)$39,377 $638 
Forward commitments11,750 168 38,000 (11)
39

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - continued (Unaudited)
ASB’s derivative financial instruments, their fair values and balance sheet location were as follows:
Derivative Financial Instruments Not Designated as Hedging Instruments 1
March 31, 2022December 31, 2021
(in thousands) Asset derivatives Liability
derivatives 		 Asset derivatives Liability
derivatives
Interest rate lock commitments$40 $58 $638 $— 
Forward commitments168 — — 11 
 $208 $58 $638 $11 
1 Asset derivatives are included in other assets and liability derivatives are included in other liabilities in the balance sheets.
The following table presents ASB’s derivative financial instruments and the amount and location of the net gains or losses recognized in ASB’s statements of income:
Derivative Financial Instruments Not Designated as Hedging Instruments Location of net gains (losses) recognized in the Statements of IncomeThree months ended March 31
(in thousands)20222021
Interest rate lock commitmentsMortgage banking income$(655)$(4,098)
Forward commitmentsMortgage banking income178 840 
 $(477)$(3,258)
Low-Income Housing Tax Credit (LIHTC). ASB’s unfunded commitments to fund its LIHTC investment partnerships were $62.8 million at March 31, 2022 and December 31, 2021. These unfunded commitments were unconditional and legally binding and are recorded in other liabilities with a corresponding increase in other assets. As of March 31, 2022, ASB did not have any impairment losses resulting from forfeiture or ineligibility of tax credits or other circumstances related to its LIHTC investment partnerships.
Note 5 · Credit agreements
On May 14, 2021, HEI and Hawaiian Electric each entered into a separate agreement with a syndicate of nine financial institutions (the HEI Facility and Hawaiian Electric Facility, respectively, and together, the Credit Facilities) to amend and restate their respective previously existing revolving unsecured credit agreements. The $175 million HEI Facility and $200 million Hawaiian Electric Facility both terminate on May 14, 2026. On February 18, 2022, the PUC approved Hawaiian Electric’s request to extend the term of the $200 million Hawaiian Electric Facility to May 14, 2026. In addition to extending the term, Hawaiian Electric also received PUC approval to exercise its options of two one-year extensions of the commitment termination date and to increase its aggregate revolving commitment amount from $200 million to $275 million, should there be a need.
None of the facilities are collateralized. As of March 31, 2022 and December 31, 2021, no amounts were outstanding under the Credit Facilities.
The Credit Facilities will be maintained to support each company’s respective short-term commercial paper program, but may be drawn on to meet each company’s respective working capital needs and general corporate purposes.

40

Note 6 · Shareholders’ equity
Accumulated other comprehensive income/(loss).  Changes in the balances of each component of accumulated other comprehensive income/(loss) (AOCI) were as follows:
HEI ConsolidatedHawaiian Electric Consolidated
 (in thousands) Net unrealized gains (losses) on securities Unrealized gains (losses) on derivativesRetirement benefit plansAOCIAOCI-Retirement benefit plans
Balance, December 31, 2021$(32,037)$(3,638)$(16,858)$(52,533)$(3,280)
Current period other comprehensive income (loss)(120,407)3,072 176 (117,159)51 
Balance, March 31, 2022$(152,444)$(566)$(16,682)$(169,692)$(3,229)
Balance, December 31, 2020$19,986 $(3,363)$(17,887)$(1,264)$(2,919)
Current period other comprehensive income (loss)(45,777)1,562 199 (44,016)34 
Balance, March 31, 2021$(25,791)$(1,801)$(17,688)$(45,280)$(2,885)

Reclassifications out of AOCI were as follows:
 Amount reclassified from AOCIAffected line item in the
 Statements of Income / Balance Sheets
Three months ended March 31
(in thousands)20222021
HEI consolidated
Net realized gains on securities included in net income$— $(387)Gain on sale of investment securities, net
Net realized losses on derivatives qualifying as cash flow hedges55 — Interest expense
Retirement benefit plans:   
Amortization of prior service credit and net losses recognized during the period in net periodic benefit cost4,501 6,010 
See Note 8 for additional details
Impact of D&Os of the PUC included in regulatory assets(4,325)(5,811)
See Note 8 for additional details
Total reclassifications$231 $(188) 
Hawaiian Electric consolidated
Retirement benefit plans:  
Amortization of prior service credit and net losses recognized during the period in net periodic benefit cost$4,376 $5,845 
See Note 8 for additional details
Impact of D&Os of the PUC included in regulatory assets(4,325)(5,811)
See Note 8 for additional details
Total reclassifications$51 $34  

41

Note 7 · Revenues
Revenue from contracts with customers. The following tables disaggregate revenues by major source, timing of revenue recognition, and segment:
Three months ended March 31, 2022
(in thousands) Electric  utilityBankOtherTotal
Revenues from contracts with customers
Electric energy sales - residential
$224,574 $— $— $224,574 
Electric energy sales - commercial
219,597 — — 219,597 
Electric energy sales - large light and power
241,123 — — 241,123 
Electric energy sales - other 1,426 — — 1,426 
Bank fees— 12,996 — 12,996 
Other sales— — 1,115 1,115 
Total revenues from contracts with customers686,720 12,996 1,115 700,831 
Revenues from other sources
Regulatory revenue$12,886 $— $— $12,886 
Bank interest and dividend income
— 59,989 — 59,989 
Other bank noninterest income— 2,130 — 2,130 
Other9,186 — 46 9,232 
Total revenues from other sources22,072 62,119 46 84,237 
Total revenues$708,792 $75,115 $1,161 $785,068 
Timing of revenue recognition
Services/goods transferred at a point in time
$— $12,996 $— $12,996 
Services/goods transferred over time
686,720 — 1,115 687,835 
Total revenues from contracts with customers$686,720 $12,996 $1,115 $700,831 
Three months ended March 31, 2021
(in thousands) Electric  utilityBankOtherTotal
Revenues from contracts with customers
Electric energy sales - residential
$181,239 $— $— $181,239 
Electric energy sales - commercial
168,465 — — 168,465 
Electric energy sales - large light and power
176,815 — — 176,815 
Electric energy sales - other2,479 — — 2,479 
Bank fees— 11,378 — 11,378 
Other sales— — 924 924 
Total revenues from contracts with customers528,998 11,378 924 541,300 
Revenues from other sources
Regulatory revenue28,429 — — 28,429 
Bank interest and dividend income
— 58,620 — 58,620 
Other bank noninterest income— 7,133 — 7,133 
Other7,437 — 27 7,464 
Total revenues from other sources35,866 65,753 27 101,646 
Total revenues$564,864 $77,131 $951 $642,946 
Timing of revenue recognition
Services/goods transferred at a point in time
$— $11,378 $— $11,378 
Services/goods transferred over time
528,998 — 924 529,922 
Total revenues from contracts with customers$528,998 $11,378 $924 $541,300 
There are no material contract assets or liabilities associated with revenues from contracts with customers existing at December 31, 2021 or as of March 31, 2022. Accounts receivable and unbilled revenues related to contracts with customers represent an unconditional right to consideration since all performance obligations have been satisfied. These amounts are disclosed as accounts receivable and unbilled revenues, net on HEI’s condensed consolidated balance sheets and customer accounts receivable, net and accrued unbilled revenues, net on Hawaiian Electric’s condensed consolidated balance sheets.
42

As of March 31, 2022, the Company had no material remaining performance obligations due to the nature of the Company’s contracts with its customers. For the Utilities, performance obligations are fulfilled as electricity is delivered to customers. For ASB, fees are recognized when a transaction is completed.
Note 8 · Retirement benefits
Defined benefit pension and other postretirement benefit plans information.  For the first three months of 2022, the Company contributed $10 million ($10 million by the Utilities) to its pension and other postretirement benefit plans, compared to $9 million ($9 million by the Utilities) in the first three months of 2021. The Company’s current estimate of total contributions to its pension and other postretirement benefit plans in 2022 is $41 million ($41 million by the Utilities), compared to $52 million ($51 million by the Utilities) in 2021. In addition, the Company expects to pay directly $3 million ($1 million by the Utilities) of benefits in 2022, compared to $1 million ($1 million by the Utilities) paid in 2021.
The components of net periodic pension costs (NPPC) and net periodic benefit costs (NPBC) for HEI consolidated and Hawaiian Electric consolidated were as follows:
Three months ended March 31
 Pension benefitsOther benefits
(in thousands)2022202120222021
HEI consolidated
Service cost$19,824 $20,464 $656 $705 
Interest cost19,811 18,801 1,637 1,569 
Expected return on plan assets(35,333)(33,067)(3,397)(3,233)
Amortization of net prior period gain— — (232)(383)
Amortization of net actuarial (gain)/losses1
6,297 1,556 (3)254 
Net periodic pension/benefit cost (return)
10,599 7,754 (1,339)(1,088)
Impact of PUC D&Os9,551 11,167 1,219 970 
Net periodic pension/benefit cost (adjusted for impact of PUC D&Os)
$20,150 $18,921 $(120)$(118)
Hawaiian Electric consolidated
Service cost$19,318 $19,994 $649 $699 
Interest cost18,462 17,531 1,573 1,504 
Expected return on plan assets(33,546)(31,368)(3,347)(3,182)
Amortization of net prior period gain— — (231)(383)
Amortization of net actuarial losses1
6,125 2,559 — 250 
Net periodic pension/benefit cost (return)
10,359 8,716 (1,356)(1,112)
Impact of PUC D&Os9,551 11,167 1,219 970 
Net periodic pension/benefit cost (adjusted for impact of PUC D&Os)
$19,910 $19,883 $(137)$(142)
1 Three months ended March 31, 2021 amounts include the one-time cumulative impact of the change in accounting principle for the plans’ fixed income securities from the calculated market-related value method to the fair value method, which was recorded in the first quarter of 2021.
HEI consolidated recorded retirement benefits expense of $12 million ($12 million by the Utilities) in the first three months of 2022 and $11 million ($12 million by the Utilities) in the first three months of 2021 and charged the remaining net periodic benefit cost primarily to electric utility plant.
The Utilities have implemented pension and OPEB tracking mechanisms under which all of their retirement benefit expenses (except for executive life and nonqualified pension plan expenses) determined in accordance with GAAP are recovered over time. Under the tracking mechanisms, any actual costs determined in accordance with GAAP that are over/under amounts allowed in rates are charged/credited to a regulatory asset/liability. The regulatory asset/liability for each utility will then be amortized over 5 years beginning with the respective utility’s next rate case.
Defined contribution plans information.  For the first three months of 2022 and 2021, the Company’s expenses for its defined contribution plans under the Hawaiian Electric Industries Retirement Savings Plan (HEIRSP) and the ASB 401(k) Plan were $2.0 million and $1.7 million, respectively, and cash contributions were $1.9 million and $1.8 million, respectively. For the first three months of 2022 and 2021, the Utilities’ expenses and cash contributions for its defined contribution plan under the HEIRSP were $0.9 million and $0.8 million, respectively.
43

Retirement benefit plan changes. On December 3, 2021, the Utilities’ union members ratified a new collective bargaining
agreement, which includes changes to retirement benefits for all new employees commencing employment on or
after January 1, 2022. The changes ratified in the collective bargaining agreement will apply to all employees of HEI and the
Utilities first hired on or after January 1, 2022 (New Employees). New Employees are not eligible to participate in the HEI
Pension Plan. Instead, New Employees will receive a non-elective employer contribution, equal to 10% of their annual
compensation, subject to a vesting schedule, to their account under the HEIRSP, the defined contribution plan for HEI and the
Utilities. Only New Employees are impacted by the retirement benefit plan changes. There are no retirement benefit plan
changes for employees hired on or before December 31, 2021.
Note 9 · Share-based compensation
Under the 2010 Equity and Incentive Plan, as amended, HEI can issue shares of common stock as incentive compensation to selected employees in the form of stock options, stock appreciation rights, restricted shares, restricted stock units, performance shares and other share-based and cash-based awards. The 2010 Equity and Incentive Plan (original EIP) was amended and restated effective March 1, 2014 (EIP) and an additional 1.5 million shares were added to the shares available for issuance under these programs.
As of March 31, 2022, approximately 2.8 million shares remained available for future issuance under the terms of the EIP, assuming recycling of shares withheld to satisfy statutory tax liabilities relating to EIP awards, including an estimated 0.6 million shares that could be issued upon the vesting of outstanding restricted stock units and the achievement of performance goals for awards outstanding under long-term incentive plans (assuming that such performance goals are achieved at maximum levels).
Under the 2011 Nonemployee Director Stock Plan (2011 Director Plan), HEI can issue shares of common stock as compensation to nonemployee directors of HEI, Hawaiian Electric and ASB. As of March 31, 2022, there were 244,347 shares remaining available for future issuance under the 2011 Director Plan.
Share-based compensation expense and the related income tax benefit were as follows:
 Three months ended March 31
(in millions)20222021
HEI consolidated
Share-based compensation expense 1
$2.1 $2.6 
Income tax benefit0.3 0.4 
Hawaiian Electric consolidated
Share-based compensation expense 1
0.6 1.1 
Income tax benefit0.1 0.3 
1    For the three months ended March 31, 2022 and 2021, the Company has not capitalized any share-based compensation.
Stock awards. There were no grants to nonemployee directors for the three months ended March 31, 2022 and 2021.
Restricted stock units.  Information about HEI’s grants of restricted stock units was as follows:
Three months ended March 31
 20222021
Shares(1)Shares(1)
Outstanding, beginning of period233,448 $38.10 193,939 $40.89 
Granted96,455 41.29 127,598 33.98 
Vested(90,380)37.58 (78,988)38.51 
Forfeited(31,178)38.78 (6,358)42.20 
Outstanding, end of period208,345 $39.71 236,191 $37.91 
Total weighted-average grant-date fair value of shares granted (in millions)$4.0 $4.3 
(1)    Weighted-average grant-date fair value per share based on the average price of HEI common stock on the date of grant.
For the three months ended March 31, 2022 and 2021, total restricted stock units and related dividends that vested had a fair value of $3.9 million and $3.0 million, respectively, and the related tax benefits were $0.6 million and $0.6 million, respectively.
44

As of March 31, 2022, there was $7.6 million of total unrecognized compensation cost related to the nonvested restricted stock units. The cost is expected to be recognized over a weighted-average period of 2.3 years.
Long-term incentive plan payable in stock.  The 2020-22, 2021-23 and 2022-24 long-term incentive plans (LTIP) provide for performance awards under the EIP of shares of HEI common stock based on the satisfaction of performance goals, including a market condition goal. The number of shares of HEI common stock that may be awarded is fixed on the date the grants are made, subject to the achievement of specified performance levels and calculated dividend equivalents. The potential payout varies from 0% to 200% of the number of target shares, depending on the achievement of the goals. The market condition goal is based on HEI’s total shareholder return (TSR) compared to the Edison Electric Institute Index over the relevant three-year period. The other performance condition goals relate to EPS growth, return on average common equity (ROACE), renewable portfolio standards, carbon emissions reduction, Hawaiian Electric’s net income growth, ASB’s efficiency ratio and strategic initiatives and Pacific Current’s EBITDA growth and return on average invested capital.
LTIP linked to TSR.  Information about HEI’s LTIP grants linked to TSR was as follows:
Three months ended March 31
 20222021
Shares(1)Shares(1)
Outstanding, beginning of period90,974 $42.86 89,222 $42.10 
Granted 26,079 54.92 44,210 41.12 
Vested (issued or unissued and cancelled)(29,042)41.07 (32,355)38.20 
Forfeited(11,671)42.60 (1,024)45.89 
Outstanding, end of period76,340 $47.70 100,053 $42.89 
Total weighted-average grant-date fair value of shares granted (in millions)$1.4 $1.8 
(1)    Weighted-average grant-date fair value per share determined using a Monte Carlo simulation model.
The grant date fair values of the shares were determined using a Monte Carlo simulation model utilizing actual information for the common shares of HEI and its peers for the period from the beginning of the performance period to the grant date and estimated future stock volatility of HEI and its peers over the remaining three-year performance period. The expected stock volatility assumptions for HEI and its peer group were based on the three-year historic stock volatility. A dividend assumption is not required for the Monte Carlo simulation because the grant payout includes dividend equivalents and projected returns include the value of reinvested dividends.
The following table summarizes the assumptions used to determine the fair value of the LTIP awards linked to TSR and the resulting fair value of LTIP awards granted:
20222021
Risk-free interest rate1.71 %0.19 %
Expected life in years33
Expected volatility31.0 %29.9 %
Range of expected volatility for Peer Group
25.4% to 76.7%
25.6% to 102.9%
Grant date fair value (per share)$54.92$41.12
For the three months ended March 31, 2022 and 2021, total vested LTIP awards linked to TSR and related dividends had a fair value of $0.8 million and $0.8 million, respectively, and the related tax benefits were $0.1 million and $0.2 million, respectively.
As of March 31, 2022, there was $2.2 million of total unrecognized compensation cost related to the nonvested performance awards payable in shares linked to TSR. The cost is expected to be recognized over a weighted-average period of 1.8 years.
45

LTIP awards linked to other performance conditions.  Information about HEI’s LTIP awards payable in shares linked to other performance conditions was as follows:
Three months ended March 31
20222021
 Shares(1)Shares(1)
Outstanding, beginning of period306,342 $38.42 220,715 $41.03 
Granted 104,300 41.29 176,844 33.98 
Vested (71,807)37.68 (43,155)34.12 
Increase above target (cancelled)— — (14,604)43.90 
Forfeited(46,684)36.77 (4,098)44.36 
Outstanding, end of period292,151 $39.89 335,702 $38.04 
Total weighted-average grant-date fair value of shares granted (at target performance levels) (in millions)
$4.3 $6.0 
(1)    Weighted-average grant-date fair value per share based on the average price of HEI common stock on the date of grant.
For the three months ended March 31, 2022 and 2021, total vested LTIP awards linked to other performance conditions and related dividends had a fair value of $3.2 million and $1.7 million, respectively, and the related tax benefits were $0.4 million and $0.4 million, respectively.
As of March 31, 2022, there was $6.6 million of total unrecognized compensation cost related to the nonvested shares linked to performance conditions other than TSR. The cost is expected to be recognized over a weighted-average period of 1.9 years.

Note 10 · Income taxes
The Company’s and the Utilities’ effective tax rates (combined federal and state income tax rates) were 20% and 21%, respectively, for the three months ended March 31, 2022. These rates differed from the combined statutory rates, due primarily to the Utilities’ amortization of excess deferred income taxes related to the provision in the Tax Act that lowered the federal income tax rate from 35% to 21%, the tax benefits derived from the low income housing tax credit investments and the non-taxability of the bank-owned life insurance income. The Company’s and the Utilities’ effective tax rates were 19% and 20%, respectively, for the three months ended March 31, 2021.
In August 2020, the Internal Revenue Service notified the Company that its 2017 and 2018 income tax returns would be examined. The Company was previously audited every year through 2011, at which time the IRS changed their internal policies regarding audit frequency. The audit is still in progress and the Company has responded to all information requests received. The Company has not been notified of any material audit adjustments to date.

46

Note 11 · Cash flows
Three months ended March 3120222021
(in millions)  
Supplemental disclosures of cash flow information  
HEI consolidated
Interest paid to non-affiliates, net of amounts capitalized$10 $15 
Hawaiian Electric consolidated
Interest paid to non-affiliates6 9 
Supplemental disclosures of noncash activities  
HEI consolidated
Property, plant and equipment
   Unpaid invoices and accruals for capital expenditures, balance, end of period (investing)24 28 
   Increase related to an acquisition (investing)15 — 
Right-of-use assets obtained in exchange for operating lease obligations (investing)35 28 
Common stock issued (gross) for director and executive/management compensation (financing)1
8 6 
Unsettled trades to purchase investment securities (investing)25 — 
Other receivable related to pending sales proceeds from the sale of an equity-method investment (investing)9 — 
Hawaiian Electric consolidated
Electric utility property, plant and equipment
   Unpaid invoices and accruals for capital expenditures, balance, end of period (investing)21 24 
   Increase related to an acquisition (investing)15 — 
Right-of-use assets obtained in exchange for operating lease obligations (investing)32 28 
1 The amounts shown represent the market value of common stock issued for director and executive/management compensation and withheld to satisfy statutory tax liabilities.
Note 12 · Fair value measurements
Fair value measurement and disclosure valuation methodology. The following are descriptions of the valuation methodologies used for assets and liabilities recorded at fair value and for estimating fair value for financial instruments not carried at fair value:
Short-term borrowings—other than bank.  The carrying amount of short-term borrowings approximated fair value because of the short maturity of these instruments.
Investment securities. The fair value of ASB’s investment securities is determined quarterly through pricing obtained from independent third-party pricing services or from brokers not affiliated with the trade. Non-binding broker quotes are infrequent and generally occur for new securities that are settled close to the month-end pricing date. The third-party pricing vendors ASB uses for pricing its securities are reputable firms that provide pricing services on a global basis and have processes in place to ensure quality and control. The third-party pricing services use a variety of methods to determine the fair value of securities that fall under Level 2 of ASB’s fair value measurement hierarchy. Among the considerations are quoted prices for similar securities in an active market, yield spreads for similar trades, adjustments for liquidity, size, collateral characteristics, historic and generic prepayment speeds, and other observable market factors.
To enhance the robustness of the pricing process, ASB will on a quarterly basis compare its standard third-party vendor’s price with that of another third-party vendor. If the prices are within an acceptable tolerance range, the price of the standard vendor will be accepted. If the variance is beyond the tolerance range, an evaluation will be conducted by ASB and a challenge to the price may be made. Fair value in such cases will be based on the value that best reflects the data and observable characteristics of the security. In all cases, the fair value used will have been independently determined by a third-party pricing vendor or non-affiliated broker.
The fair value of the mortgage revenue bonds is estimated using a discounted cash flow model to calculate the present value of future principal and interest payments and, therefore is classified within Level 3 of the valuation hierarchy.
47

Loans held for sale. Residential and commercial loans are carried at the lower of cost or market and are valued using market observable pricing inputs, which are derived from third party loan sales and, therefore, are classified within Level 2 of the valuation hierarchy.
Loans held for investment. Fair value of loans held for investment is derived using a discounted cash flow approach which includes an evaluation of the underlying loan characteristics. The valuation model uses loan characteristics which includes product type, maturity dates and the underlying interest rate of the portfolio. This information is input into the valuation models along with various forecast valuation assumptions including prepayment forecasts, to determine the discount rate. These assumptions are derived from internal and third party sources. Since the valuation is derived from model-based techniques, ASB includes loans held for investment within Level 3 of the valuation hierarchy.
Collateral dependent loans. Collateral dependent loans have been adjusted to fair value. When a loan is identified as collateral dependent, the Company measures the impairment using the current fair value of the collateral, less selling costs. Depending on the characteristics of a loan, the fair value of collateral is generally estimated by obtaining external appraisals, but in some cases, the value of the collateral may be estimated as having little or no value. Non-real estate collateral may be valued using an appraisal, net book value per the borrower’s financial statements, or aging reports, adjusted or discounted based on management’s historical knowledge, changes in market conditions from the time of the valuation and management’s expertise and knowledge of the client and client’s business, resulting in a Level 3 fair value classification. If it is determined that the value of the collateral dependent loan is less than its recorded investment, the Company recognizes this impairment and adjusts the carrying value of the loan to fair value through the allowance for credit losses.
Real estate acquired in settlement of loans. Foreclosed assets are carried at fair value (less estimated costs to sell) and are generally based upon appraisals or independent market prices that are periodically updated subsequent to classification as real estate owned. Such adjustments typically result in a Level 3 classification of the inputs for determining fair value. ASB estimates the fair value of collateral-dependent loans and real estate owned using the sales comparison approach.
Mortgage servicing rights. MSRs are capitalized at fair value based on market data at the time of sale and accounted for in subsequent periods at the lower of amortized cost or fair value. MSRs are evaluated for impairment at each reporting date. ASB's MSRs are stratified based on predominant risk characteristics of the underlying loans including loan type and note rate. For each stratum, fair value is calculated by discounting expected net income streams using discount rates that reflect industry pricing for similar assets. Expected net income streams are estimated based on industry assumptions regarding prepayment expectations and income and expenses associated with servicing residential mortgage loans for others. Impairment is recognized through a valuation allowance for each stratum when the carrying amount exceeds fair value, with any associated provision recorded as a component of loan servicing fees included in "Revenues - bank" in the consolidated statements of income. A direct write-down is recorded when the recoverability of the valuation allowance is deemed to be unrecoverable. ASB compares the fair value of MSRs to an estimated value calculated by an independent third-party. The third-party relies on both published and unpublished sources of market related assumptions and its own experience and expertise to arrive at a value. ASB uses the third-party value only to assess the reasonableness of its own estimate. ASB includes MSRs within Level 3 of the valuation hierarchy.
Time deposits. The fair value of fixed-maturity certificates of deposit was estimated by discounting the future cash flows using the rates currently offered for FHLB advances of similar remaining maturities. Deposit liabilities are classified in Level 2 of the valuation hierarchy.
Other borrowings. For advances and repurchase agreements, fair value is estimated using quantitative discounted cash flow models that require the use of interest rate inputs that are currently offered for advances and repurchase agreements of similar remaining maturities. The majority of market inputs are actively quoted and can be validated through external sources, including broker market transactions and third party pricing services.
Long-term debt—other than bank.  Fair value of fixed-rate long-term debt—other than bank was obtained from third-party financial services providers based on the current rates offered for debt of the same or similar remaining maturities and from discounting the future cash flows using the current rates offered for debt of the same or similar risks, terms, and remaining maturities. The carrying amount of floating rate long-term debt—other than bank approximated fair value because of the short-term interest reset periods. Long-term debt—other than bank is classified in Level 2 of the valuation hierarchy.
Interest rate lock commitments (IRLCs). The estimated fair value of commitments to originate residential mortgage loans for sale is based on quoted prices for similar loans in active markets. IRLCs are classified as Level 2 measurements.
Forward sales commitments. To be announced (TBA) mortgage-backed securities forward commitments are classified as Level 1, and consist of publicly-traded debt securities for which identical fair values can be obtained through quoted market prices in active exchange markets. The fair values of ASB’s best efforts and mandatory delivery loan sale commitments are determined using quoted prices in the market place that are observable and are classified as Level 2 measurements.
48

The following table presents the carrying or notional amount, fair value and placement in the fair value hierarchy of the Company’s financial instruments.
Estimated fair value
(in thousands)Carrying or notional amountQuoted prices in
active markets
for identical assets
 (Level 1)		Significant
 other observable
 inputs
 (Level 2)		Significant
unobservable
inputs
 (Level 3)		Total
March 31, 2022     
Financial assets     
HEI consolidated
Available-for-sale investment securities
$2,621,375 $— $2,606,079 $15,296 $2,621,375 
Held-to-maturity investment securities
517,150 — 466,236 — 466,236 
Loans, net5,125,483 — 7,932 5,014,000 5,021,932 
Mortgage servicing rights10,024 — — 16,274 16,274 
Derivative assets30,043 168 824 — 992 
Financial liabilities    
HEI consolidated
Deposit liabilities394,015 — 386,547 — 386,547 
Short-term borrowings—other than bank71,491 — 71,491 — 71,491 
Other bank borrowings137,385 — 137,383 — 137,383 
Long-term debt, net—other than bank2,316,046 — 2,390,702 — 2,390,702 
  Derivative liabilities31,049 — 1,704 — 1,704 
Hawaiian Electric consolidated
Short-term borrowings6,000 — 6,000 — 6,000 
Long-term debt, net 1,676,581 — 1,765,004 — 1,765,004 
December 31, 2021     
Financial assets     
HEI consolidated
Available-for-sale investment securities
$2,574,618 $— $2,559,191 $15,427 $2,574,618 
Held-to-maturity investment securities
522,270 — 510,474 — 510,474 
Loans, net5,150,388 — 10,403 5,218,121 5,228,524 
Mortgage servicing rights9,950 — — 14,480 14,480 
Derivative assets57,377 — 909 — 909 
Financial liabilities    
HEI consolidated
Deposit liabilities423,976 — 442,361 — 442,361 
Short-term borrowings—other than bank53,998 — 53,998 — 53,998 
Other bank borrowings88,305 — 88,304 — 88,304 
Long-term debt, net—other than bank2,321,937 — 2,624,130 — 2,624,130 
Derivative liabilities57,000 11 5,271 — 5,282 
Hawaiian Electric consolidated
Long-term debt, net 1,676,402 — 1,955,710 — 1,955,710 
49

Fair value measurements on a recurring basis.  Assets and liabilities measured at fair value on a recurring basis were as follows:
March 31, 2022December 31, 2021
 Fair value measurements usingFair value measurements using
(in thousands)Level 1Level 2Level 3Level 1Level 2Level 3
Available-for-sale investment securities (bank segment)      
Mortgage-backed securities — issued or guaranteed by U.S. Government agencies or sponsored agencies
$— $2,456,754 $— $— $2,437,923 $— 
U.S. Treasury and federal agency obligations— 106,202 — — 90,090 — 
Corporate bonds— 43,123 — — 31,178 — 
Mortgage revenue bonds— — 15,296 — — 15,427 
 $— $2,606,079 $15,296 $— $2,559,191 $15,427 
Derivative assets     
Interest rate lock commitments (bank segment)1
$— $40 $— $— $638 $— 
Forward commitments (bank segment)1
168 — — — — — 
Interest rate swap (Other segment)2
— 784 — — 271 — 
 $168 $824 $— $— $909 $— 
Derivative liabilities
Interest rate lock commitments (bank segment)1
$— $58 $— $— $— $— 
Forward commitments (bank segment)1
— — — 11 — — 
Interest rate swap (Other segment)2
— 1,646 — — 5,271 — 
$— $1,704 $— $11 $5,271 $— 
1     Derivatives are carried at fair value in other assets or other liabilities in the balance sheets with changes in value included in mortgage banking income.
2     Derivatives are included in other assets and other liabilities in the balance sheets.
The changes in Level 3 assets and liabilities measured at fair value on a recurring basis were as follows:
Three months ended March 31
Mortgage revenue bonds20222021
(in thousands)
Beginning balance$15,427 $27,185 
Principal payments received(131)(11,758)
Purchases— — 
Unrealized gain (loss) included in other comprehensive income— — 
Ending balance$15,296 $15,427 
Mortgage revenue bonds are issued by the Department of Budget and Finance of the State of Hawaii. The Company estimates the fair value by using a discounted cash flow model to calculate the present value of estimated future principal and interest payments. The unobservable input used in the fair value measurement is the weighted average discount rate. As of March 31, 2022, the weighted average discount rate was 2.27%, which was derived by incorporating a credit spread over the one month LIBOR rate. Significant increases (decreases) in the weighted average discount rate could result in a significantly lower (higher) fair value measurement.
Fair value measurements on a nonrecurring basis.  Certain assets and liabilities are measured at fair value on a nonrecurring basis and therefore are not included in the tables above. These measurements primarily result from assets carried at the lower of cost or fair value or from impairment of individual assets. As of March 31, 2022 and December 31, 2021, there were no financial instruments measured at fair value on a nonrecurring basis. For the three months ended March 31, 2022 and 2021, there were no adjustments to fair value for ASB’s loans held for sale.
Significant increases (decreases) in any of those inputs in isolation would result in significantly higher (lower) fair value measurements.
50

Item 2.  Management’s Discussion and Analysis of Financial Condition and Results of Operations
The following discussion updates “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in HEI’s and Hawaiian Electric’s 2021 Form 10-K and should be read in conjunction with such discussion and the 2021 annual consolidated financial statements of HEI and Hawaiian Electric and notes thereto included in HEI’s and Hawaiian Electric’s 2021 Form 10-K, as well as the quarterly (as of and for the three months ended March 31, 2022) condensed consolidated financial statements and notes thereto included in this Form 10-Q.
HEI consolidated
Recent developments—COVID-19. Hawaii’s 7-day average daily COVID-19 case counts have receded from the high of 4,610 reached in January 2022 and recently the 7-day average for new cases was 436 as of April 25, 2022. In March 2022, the state ended the Safe Travels program for domestic U.S. travelers and the indoor mask mandate. Hawaii vaccinations have steadily increased with over 77% of the state’s population fully vaccinated as of April 19, 2022 and 39% of those fully vaccinated received a third shot.
Tourism numbers remain below pre-pandemic levels, primarily due to a delayed recovery in international travel. However, domestic travel has recovered significantly and recently exceeded pre-pandemic levels, with March 2022 total domestic passenger counts at approximately 112% of March 2019 (pre-pandemic) total domestic passenger counts. Although the Hawaii economy experienced a temporary setback with the Delta and Omicron variants, the Hawaii economy is expected to continue its improvement in 2022 with the lifting of restrictions and gradual return of international travel.
In the first quarter of 2022, Utility kWh sales remained below pre-pandemic levels, but were 2.5% higher than the first quarter of 2021 due to increased economic activity following the loosening of restrictions and an increase in tourism. While the level of kWh sales does not affect Utility revenues due to decoupling, it may increase or decrease the price per kWh paid by customers. See “Decoupling” in Note 3 of the Condensed Consolidated Financial Statements for a discussion of the decoupling mechanism.
At the Bank, due to favorable credit trends and continued improvement in the economic environment, ASB recorded a $3.3 million negative provision for credit losses in the first quarter of 2022 compared to a negative provision for credit losses of $8.4 million in the first quarter of 2021. Net interest income increased $1.9 million to $59.0 million in the first quarter of 2022 due to growth in the investment securities portfolio that was principally funded by the growth in deposits, as well as lower amortization of premiums in the investment portfolio. The higher net interest income from the investment portfolio was partly offset by the impact of a decrease in loan portfolio balances and lower loan portfolio yields as a result of the low interest rate environment and lower PPP fees.
For further discussion of the impact of the COVID-19 pandemic on the Utilities and the Bank, see “Recent Developments—COVID-19” in the Electric Utility and Bank sections below. There has been no material impact on the “Other” segment and Pacific Current as a result of the COVID-19 pandemic as the primary businesses of Pacific Current are supported by PPAs that provide for contractual cash flows with credit-worthy counterparties.
For a discussion regarding the impact of the economic conditions caused by the COVID-19 pandemic on the Company’s liquidity and capital resources, see discussion under “Financial Condition–Liquidity and capital resources,” contained in each of the “HEI Consolidated,” “Electric utility” and “Bank” sections of this MD&A.
Environmental, Social & Governance. At HEI, environmental, social and governance (ESG) principles and sustainability have long been embedded within all aspects of the Company’s activities and integral to the Company’s efforts to create value for all of its stakeholders. With all of its operations isolated in the middle of the Pacific Ocean, the Company’s long-term health and financial performance is inextricably linked with the strength of the Hawaii economy, its communities, and the environment. That is why long-term shareholder and broader stakeholder value are both served by the Company’s mission to be a catalyst for a better Hawaii.
In 2021, the Company identified a number of priorities that reflect the essential connection between the health of Hawaii’s environment, economy and communities and HEI’s long-term success. The key ESG priorities the Company is working to advance include:
•decarbonizing the Company’s operations and the broader Hawaii economy;
•promoting Hawaii’s economic health and improving affordability for all residents;
•ensuring reliability and resilience as the Company navigates the clean energy transition and adapts to a changing climate;
•advancing digitalization of the Company’s operations to better serve customers and increase efficiency while protecting against cyber-security challenges;
51

•promoting diversity, equity and inclusion both within the Company and in the ways the Company interacts with and impacts external stakeholders;
•increasing employee engagement; and
•identifying and integrating climate-related risks and opportunities throughout the Company’s planning and decision-making.
The Company has also focused on ensuring that ESG considerations are appropriately integrated into governance structures, strategies and risk management. This includes:
•Integration of Board oversight of important ESG matters into its existing governance structures and processes. This includes full Board review of ESG-related strategies, Audit & Risk Committee oversight of ESG risks, Compensation & Human Capital Management Committee responsibility for ESG-related compensation matters and human capital management and Nominating and Corporate Governance Committee responsibility for ensuring an appropriate board governance framework is in place with respect to ESG.
•Robust ESG expertise among board members, including directors with direct experience in renewable energy, climate change policy and strategy, environmental management and sustainable investing.
•Expanded ESG goals as part of HEI and Utility executive incentive compensation.
•ESG considerations explicitly woven into strategic planning efforts and enterprise risk management processes.
The Company is committed to transparency and providing information to allow customers, community leaders, investors and other stakeholders understand how the Company’s strategies and operations advance ESG objectives and contribute to long-term stakeholder value creation.
The Company issued its first ESG report in September 2020. The report encompassed ESG policies, principles and results reported during 2019 across the Company’s two primary operating subsidiaries, Hawaiian Electric and ASB, and was aligned with Sustainability Accounting Standards Board (SASB) guidance—using the electric utilities standard for Hawaiian Electric, and the commercial banks, commercial finance, and mortgage finance standards for ASB. On April 22, 2021, the Company issued its second ESG report. This report continues to include SASB disclosures for Hawaiian Electric and ASB and incorporates disclosures regarding risks and opportunities related to climate change, as well as associated risk management and governance processes, based on recommendations from the Task Force on Climate-related Financial Disclosures. It also outlines key impacts for the Company under two climate scenarios, including a scenario targeted to limit global temperature rise to 2 degrees Celsius or lower. On April 12, 2022, the Company issued its third and most comprehensive ESG report. The report includes HEI's first enterprise-wide greenhouse gas (GHG) emissions inventory, which will further guide the company's ESG strategies and provide greater transparency around its progress on climate issues. Net enterprise-wide GHG emissions in measured categories have decreased over time, driven largely by reductions in the utility's generation-related emissions The Company’s ESG reports can be found at www.hei.com/esg.
RESULTS OF OPERATIONS

Three months ended March 31%
(in thousands)20222021changePrimary reason(s)*
Revenues$785,068 $642,946 22 Primarily increase for the electric utility segment
Operating income99,276 98,031 1 Increase for the electric utility segment and lower losses for the “other” segment, partly offset by decrease for bank segment
Net income for common stock69,167 64,358 7 Higher net income at the electric utility segment and lower net loss for the “other” segment, partly offset by lower net income at the bank segment. See below for effective tax rate explanation.
*     Also, see segment discussions which follow.
The Company’s effective tax rates for the first three months of 2022 and 2021 were comparable at 20% and 19%, respectively.
Economic conditions.
Note: The statistical data in this section is from public third-party sources that management believes to be reliable (e.g., Department of Business, Economic Development and Tourism (DBEDT), University of Hawaii Economic Research Organization (UHERO), Department of Health of the State of Hawaii , U.S. Bureau of Labor Statistics, Department of Labor
52

and Industrial Relations (DLIR), Hawaii Tourism Authority (HTA), Honolulu Board of REALTORS® and national and local news media).
At the end of March 2022, the Safe Travels Program, which required proof of vaccination or a negative COVID test for travel to Hawaii, ended following a significant reduction in case counts in recent months. In addition, lower case counts across most states also led to stronger demand for travel to Hawaii in the first quarter of 2022, resulting in the average daily passenger count 122.7% higher than the comparable period in the prior year, but still 16.8% below 2019. The recovery in total passenger counts from the low levels in 2020 thus far has been driven by domestic travelers, with international travelers remaining at low levels due to higher restrictions for international travelers, depending on country of origin. In March 2022, domestic passenger counts were up 10.8% compared to 2019 pre-COVID-19 levels, while international passenger counts were down 87% compared to 2019 pre-COVID-19 levels.
Hawaii’s seasonally adjusted unemployment rate in March 2022 was 4.1%, which was lower compared to the March 2021 rate of 6.6%. The national unemployment rate in March 2022 was 3.6% compared to 6.0% in March 2021. Hawaii’s unemployment rate is expected to continue to improve now that restrictions have been lifted.
Hawaii real estate activity through March 2022, as indicated by Oahu’s home resale market, drove an increase in the median sales price of 12.1% for condominiums and 20.2% for single-family homes compared to the same period in 2021, with the March median single-family home price reaching a record $1,150,000 set in March. The number of closed sales was up 16.8% for condominiums and down 2.6% for single-family residential homes for the first quarter of 2022 compared to 2021.
Hawaii’s petroleum product prices reflect supply and demand in the Asia-Pacific region and the price of crude oil in international markets. The price of crude oil gradually increased throughout 2021 but decreased in January 2022 and increased significantly in February 2022.
At its March 15, 2022 meeting, the Federal Open Market Committee (FOMC) decided to raise the federal funds rate target range of 0.25%-0.5%. The FOMC plans to continue to maintain an accommodative stance of monetary policy to achieve maximum employment and inflation at the rate of 2 percent over the long run. The Federal Reserve stated that it will begin to reduce its holdings of Treasury securities and agency mortgage-backed securities.
The most recent forecast by UHERO, which was issued on March 6, 2022, forecasts full year 2022 real GDP growth of 3.8%, increase in total visitor arrivals of 29.1%, decrease in real personal income of 4.7%, and an unemployment rate of 5.1%. This forecast reflects improvement of Hawaii’s economy after experiencing a downturn due to the Delta and Omicron variants of COVID-19 in 2021. The international market is still anticipated to gradually return in late summer of 2022. However, a full economic recovery is still forecasted to be several years out and dependent on the ability to adapt to new COVID-19 threats, the global economic fallout from Russia’s invasion of Ukraine, increasing federal interest rates, and the return of international visitors.
The Company expects economic conditions to improve going forward; however, it is difficult to predict the future path of the pandemic. If economic conditions worsen from current levels or remain depressed for an extended period of time, it could have a material unfavorable impact on the Company’s financial position or results of operations in 2022.
See also “Recent Developments—COVID-19” in the “Electric utility” and “Bank” sections below for further discussion of the economic impact caused by the pandemic.
“Other” segment.
 Three months ended March 31
(in thousands)20222021Primary reason(s)
Revenues$1,161 $951 Increase in other sales at Pacific Current subsidiaries.
Operating loss(4,349)(6,379)
The first three months of 2022 and 2021 include $0.8 million and $0.7 million, respectively, of operating income from Pacific Current1. Corporate expenses for the first three months of 2022 was $1.9 million lower than the same period in 2021, primarily due to lower charitable donations, due to timing of contributions.
Gain on sale of equity-method investment8,123 — Gain on sale of an equity-method investment at Pacific Current.
Net loss (1,112)(8,556)
The net loss for the first three months of 2022 was lower than the net loss for the first three months of 2021 due to the gain on sale of an equity-method investment by Pacific Current and the same factors cited for the change in operating loss.
1     Hamakua Energy’s sales to Hawaii Electric Light (a regulated affiliate) are eliminated in consolidation.

53

The “other” business segment loss includes results of the stand-alone corporate operations of HEI (including eliminations of intercompany transactions) and ASB Hawaii, Inc. (ASB Hawaii), as well as the results of Pacific Current, a direct subsidiary of HEI focused on investing in clean energy and sustainable infrastructure projects; Pacific Current’s indirect subsidiary, Hamakua Energy, which owns a 60-MW combined cycle power plant that provides electricity to Hawaii Electric Light; Pacific Current’s subsidiaries, Mauo, LLC (Mauo), which owns solar-plus-storage projects totaling 8.6 MW on five University of Hawaii campuses, Alenuihaha Developments, LLC, which owns a collection of renewable energy assets, Ka‘ie‘ie Waho Company, LLC, which owns a 6 MW solar photovoltaic system that provides renewable energy to Kauai Island Utility Cooperative, and Ka‘aipua‘a, LLC, which is constructing a wastewater treatment and energy recovery facility on Hawaii island; as well as eliminations of intercompany transactions.

FINANCIAL CONDITION
Liquidity and capital resources.  As of March 31, 2022, there was no balance on HEI’s revolving credit facility or Hawaiian Electric’s revolving credit facility and the available committed capacities under the facilities were $175 million and $200 million, respectively. At the end of the quarter, HEI and Hawaiian Electric had approximately $66 million and $6 million of commercial paper outstanding, respectively. As of March 31, 2022, ASB’s unused FHLB borrowing capacity was approximately $2.1 billion and ASB had unpledged investment securities of $2.8 billion that were available to be used as collateral for additional borrowing capacity.
As of March 31, 2022 and December 31, 2021, the total amount of available borrowing capacity (net of commercial paper outstanding) under the Company’s committed lines of credit was approximately $304 million and $321 million, respectively.
The Company believes that its cash and cash equivalents, expected operating cash flow from subsidiaries, existing credit facilities, and access to the capital markets will be sufficient to meet the Company’s cash requirements over the next twelve months and beyond based on its current business plans. However, the Company expects that its liquidity will continue to be moderately impacted at the Utilities due to higher working capital requirements due to lingering COVID-19 impacts to the local economy. For the Utilities, the economic impact of the pandemic on customers have resulted in higher accounts receivable balances and bad debt expense and may result in higher write-offs in the future. As of March 31, 2022, approximately $38 million of the Utilities’ accounts receivables were 30 days past due. Of the over 30 days past due amounts, approximately 23% were on payment plans. The Company commenced its disconnection process on a tiered basis, starting in the third quarter of 2021, targeting the oldest and largest balances first, which is expected to reduce delinquent accounts receivable balances over time as payments are made. In addition to the cash flow impact from delayed collection of accounts receivable, lower kWh sales relative to the level of kWh sales approved in the last rate case generally result in delayed timing of cash flows, resulting in higher working capital requirements (see “Recent Developments—COVID-19” in the Electric utility section below). At this time, the delay in customer cash collections has not significantly affected the Company’s liquidity. The Company is prepared to address, if needed, the potential financing requirement related to the delayed timing of customer collections.
At ASB, liquidity remains at satisfactory levels largely due to U.S. economic stimulus programs implemented as a result of COVID-19 that led to a substantial increase in customer deposits. ASB’s cash and cash equivalents was $270 million as of March 31, 2022, compared to $251 million as of December 31, 2021. ASB remains well above the “well capitalized” level under the FDIC Improvement Act prompt correction action capital category, and while the economic outlook has improved and is expected to continue to improve, there are still COVID-19 risks, such as new variants, that could create ongoing uncertainty regarding COVID-19’s impact on loan performance and the allowance for credit losses (see “Recent Developments — COVID-19” in the Bank section below).
HEI material cash requirements. HEI’s material cash requirements include: capital expenditures, labor and benefit costs, O&M expenses, fuel and purchase power costs, and debt and interest payments at the Utilities; investments in loans and investment securities at the Bank; labor and benefits costs, shareholder dividends and debt and interest payments at HEI; and HEI equity contributions to support Pacific Current’s sustainable infrastructure investments.
The Company believes that its ability to generate cash, both internally from electric utility and banking operations and externally from issuances of equity and debt securities, as well as bank borrowings, is adequate to maintain sufficient liquidity to fund its contractual obligations and commercial commitments, its forecasted capital expenditures and investments, its expected retirement benefit plan contributions and other short-term and long-term material cash requirements. However, the COVID-19 pandemic continues to be an evolving situation, and the Company cannot predict the extent or duration of outbreaks from new variants, the future effects that it will have on the global, national or local economy, including the impact on the Company’s cost of capital and its ability to access additional capital, or the future impacts on the Company’s financial position, results of operations, and cash flows.
54

The consolidated capital structure of HEI (excluding deposit liabilities and other bank borrowings) was as follows:
(dollars in millions)March 31, 2022December 31, 2021
Short-term borrowings—other than bank$71 1 %$54 1 %
Long-term debt, net—other than bank2,316 49 2,322 48 
Preferred stock of subsidiaries34 1 34 1 
Common stock equity2,304 49 2,391 50 
 $4,725 100 %$4,801 100 %
HEI’s commercial paper borrowings and line of credit facility were as follows:
 Average balanceBalance
(in millions) Three months ended March 31, 2022March 31, 2022December 31, 2021
Commercial paper$51 $66 $54 
Line of credit draws on revolving credit facility— — — 
Note: This table does not include Hawaiian Electric’s separate commercial paper issuances and line of credit facilities and draws, which are disclosed below under “Electric utility—Financial Condition—Liquidity and capital resources.” The maximum amount of HEI’s short-term commercial paper borrowings during the first three months of 2022 was $66 million. As of March 31, 2022, available committed capacity under HEI’s line of credit facility was $175 million.
There were no new issuances of common stock through the HEI Dividend Reinvestment and Stock Purchase Plan (DRIP), HEIRSP or the ASB 401(k) Plan in the three months ended March 31, 2022 and 2021 and HEI satisfied the share purchase requirements of the DRIP, HEIRSP and ASB 401(k) Plan through open market purchases of its common stock.
For the first three months of 2022, net cash provided by operating activities of HEI consolidated was $93 million. Net cash used by investing activities for the same period was $228 million, primarily due to capital expenditures, ASB’s purchases of available-for-sale investment securities, partly offset by ASB’s receipt of investment security repayments and maturities and net decrease in loans. Net cash provided by financing activities during this period was $131 million as a result of several factors, including net increases in ASB’s deposit liabilities and other bank borrowings, the issuances of long-term debt and net increases in short-term borrowings, partly offset by repayment of long-term debt and payment of common stock dividends. During the first three months of 2022, Hawaiian Electric and ASB (through ASB Hawaii) paid cash dividends to HEI of $31 million and $15 million, respectively.
Dividends.  The payout ratios for the first three months of 2022 and full year 2021 were 55% and 60%, respectively. On February 11, 2022, the HEI Board of Directors approved a 1 cent increase in the quarterly dividend from $0.34 per share to $0.35 per share, starting with the dividend in the first quarter of 2022. HEI currently expects to maintain its dividend at its present level; however, the HEI Board of Directors evaluates the dividend quarterly and considers many factors in the evaluation including, but not limited to, the Company’s results of operations, the long-term prospects for the Company, current and expected future economic conditions, including impacts from the COVID-19 pandemic, and capital investment alternatives.
MATERIAL ESTIMATES AND CRITICAL ACCOUNTING POLICIES
In preparing financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities and the reported amounts of revenues and expenses. Actual results could differ significantly from those estimates.
In accordance with SEC Release No. 33-8040, “Cautionary Advice Regarding Disclosure About Critical Accounting Policies,” management has identified the accounting policies it believes to be the most critical to the Company’s financial statements—that is, management believes that these policies are both the most important to the portrayal of the Company’s results of operations and financial condition, and currently require management’s most difficult, subjective or complex judgments.
For information about these material estimates and critical accounting policies, in addition to the critical policy discussed below, see pages 45 to 46, 62 to 63, and 76 to 77 of HEI’s MD&A included in Part II, Item 7 of HEI’s 2021 Form 10-K.
Following are discussions of the results of operations, liquidity and capital resources of the electric utility and bank segments.
55

Electric utility
Recent developments—COVID-19
See also Recent developments—COVID-19 in HEI’s MD&A.
In the first quarter of 2022, COVID-19 case counts peaked in mid-January 2022, followed by a rapid decline in case counts and hospitalizations by the end of the quarter. In response to the improvement in COVID-19 trends, in March 2022, the state ended the Safe Travels program that required proof of vaccination or a negative COVID-19 test for transpacific travelers and removed the indoor mask mandate. As a result, for the first quarter of 2022, driven by continued recovery of the economy and the lifting of all COVID-19 restrictions, the demand for electricity increased 2.5% from 2021 levels.
Accounts receivable collection trends improved in the first quarter with past due accounts receivable balances decreasing by $6.2 million, or 9%, and the number of accounts past due decreasing by approximately 4% since December 31, 2021. The decrease in accounts receivables was primarily driven by payments on installment plans, Low Income Home Energy Assistance Program payment, a large government account payment that was previously in arrears, higher cash receipts associated with increased disconnection efforts, application of the $2 million Kokua bill credit, offset by higher customer balances driven by higher fuel prices. At this time, the delay in customer cash collections has not significantly affected the Utilities’ liquidity. The Utilities are prepared to address, if needed, the financing requirement related to the delayed timing of cash flows collected under the decoupling mechanism through the RBA and the modest slowing or reduction in accounts receivable collections from customers. See “Financial Condition—Liquidity and capital resources” for additional information.
In the second quarter of 2020, the PUC approved the deferral of certain COVID-19 related costs, such as higher bad debt expense, higher financing costs, non-collection of late payment fees, increased personal protective equipment costs, and sequestration costs for mission-critical employees. As of March 31, 2022, these cumulative costs, which have been deferred and recorded as a regulatory asset, totaled approximately $27.8 million (see also discussion under “Regulatory assets for COVID-19 related costs” in Note 3 of the Condensed Consolidated Financial Statements). The Utilities deferred COVID-19 related costs through a PUC approved period that ended on December 31, 2021 and will be seeking recovery of the deferred costs in a separate proceeding to be filed in the second quarter of 2022.
Looking forward, while case counts and hospitalizations have declined since the peak in January 2022, the positivity rate has recently increased. A worsening of COVID-19 case counts with existing or new variants or a reinstatement of COVID-19 restrictions could adversely affect the ability of the Utilities’ contractors, suppliers, IPPs, and other business partners to perform or fulfill their obligations timely, or at all, or require modifications to existing contracts, which could adversely affect the Utilities’ business, increase expenses, and impact the Utilities’ ability to achieve their RPS and other climate related goals. Additionally, while the state’s aggressive response to the pandemic has managed to control the spread of the coronavirus, the measures taken have had a negative economic impact on the state’s businesses and residents, which may influence the PUC’s actions regarding future rate increases.
In March 2022, the consumer price index reached a 40-year high of 8.5% as gas prices and rents spiked. In Hawaii, the Urban Hawaii (Honolulu) Consumer Price Index (CPI) was 7.5% higher than it was one year ago. For the Utilities, the inflationary impacts have primarily manifested as higher fuel prices, which have increased 62% quarter-over-quarter. Although the Utilities are able to pass through fuel costs to customers and have limited fuel cost exposure through a 2% fuel-cost sharing mechanism (approximately $3.7 million exposure annually), higher customer bills could reduce customers’ ability to pay timely or increase the risk of non-payment. In addition, the higher customer bills may lead the PUC to consider other actions to limit or delay any proposed increase in rates in order to mitigate the overall bill impact of rising fuel prices.
Under the PBR framework, the Utilities receive annual inflationary adjustments (compounded) on test year target revenues. The annual revenue adjustment is equal to the gross domestic producer price index (GDPPI), less a productivity factor (currently zero) and a 0.22% customer dividend, multiplied by the previous year’s adjusted revenue requirements. The GDPPI adjustment is measured in October and is effective for the following calendar year. For the 2022 calendar year, GDPPI was measured at 3% in October 2021 and will be remeasured in October 2022 for the 2023 calendar year. Although the GDPPI inflationary adjustment protects the Utilities from inflationary pressures over time, there may be a lag in recovery when prices move rapidly as they have done in recent months.
For a discussion regarding the impact of the economic conditions caused by the COVID-19 pandemic on the Utilities’ liquidity and capital resources, see discussion under “Financial Condition–Liquidity and capital resources.”
56

RESULTS OF OPERATIONS
Three months ended March 31Increase 
20222021(decrease)(dollars in millions, except per barrel amounts)
$709 $565 $144 
Revenues. Net increase largely due to:
$105 
higher fuel oil prices and higher kWh generated1
25 
higher purchased power energy prices offset by lower kWh purchased2
10 higher revenue from ARA adjustments, which included an offset of management audit savings delivered to customers
2 revenue in 2022 related to ownership of and responsibility for the U.S. Army’s electrical distribution system on Oahu starting March 1, 2022, offset by an equal amount of operating expense
1 increase related solely to a change in the timing for revenue recognition within the year, which eliminates seasonality in recognizing target revenues and results in recognizing revenues evenly throughout the year with target revenues recognized on an annual basis remaining unchanged
1higher MPIR and PIMs revenue
221 127 94 
Fuel oil expense1. Net increase largely due to higher fuel oil prices and higher kWh generated partially offset by lower penalties for fuel efficiency due to reset of heat rate
164 142 22 
Purchased power expense1, 2. Net increase largely due to higher purchased power energy prices partially offset by lower kWh purchased and lower capacity charges
125 115 10 
Operation and maintenance expenses. Net increase largely due to:
2 more generating facility overhauls and maintenance work performed
2 expense in 2022 related to ownership of and responsibility for the U.S. Army’s electrical distribution system on Oahu starting March, 1, 2022, offset by an equal amount of revenue
2 higher transmission and distribution preventive and corrective maintenance expense
1 higher outside services for Information Technology and Services support, Demand Response Management System, and Battery Bonus program
1 higher property damage and legal reserve for pending claims
1 higher bad debt expense
125 111 14 
Other expenses. Increase due to higher revenue taxes, coupled with higher depreciation expense in 2022 for plant investments in 2021
74 69 5 
Operating income. Increase largely due to higher ARA revenue, MPIR and PIMs revenue and lower penalties for fuel efficiency, partially offset by higher operation and maintenance expenses and higher depreciation expense
59 55 4 
Income before income taxes. Increase largely due to higher operating income
46 43 3 
Net income for common stock. Increase largely due to higher operating income. See below for effective tax rate explanation
1,957 1,909 48 
Kilowatthour sales (millions)3
$103.40 $63.87 $39.53 Average fuel oil cost per barrel
470,851 468,745 2,106 Customer accounts (end of period)
1The rate schedules of the electric utilities currently contain ECRCs through which changes in fuel oil prices and certain components of purchased energy costs are passed on to customers.
2The rate schedules of the electric utilities currently contain PPACs through which changes in purchased power expenses (except purchased energy costs) are passed on to customers.
3 In the first quarter of 2022, kWh sales were higher when compared to the same periods last year largely due to continued recovery from the impacts of the COVID-19 pandemic. COVID-19 cases peaked in January 2022 due to the Omicron variant, but case counts have since returned to pre-Omicron levels. U.S. visitor arrivals continued to increase above first quarter of 2021 levels and approach pre-pandemic levels, but international arrivals remain low. With the outlook of the pandemic transitioning to an endemic status and remaining restrictions removed at the end of March, the economic recovery is expected to strengthen this year as international visitors return and sales rebound, although the improvement is expected to remain below pre-pandemic levels.
57


The Utilities’ effective tax rate for the first three months of 2022 and 2021 were comparable at 21% and 20%, respectively.
Hawaiian Electric’s consolidated ROACE was 8.1% and 9.0% for the twelve months ended March 31, 2022 and March 31, 2021, respectively.
The net book value (cost less accumulated depreciation) of utility property, plant and equipment (PPE) as of March 31, 2022 amounted to $4.9 billion, of which approximately 25% related to generation PPE, 66% related to transmission and distribution PPE, and 9% related to other PPE. Approximately 8% of the total net book value relates to generation PPE that has been deactivated or that the Utilities plan to deactivate or decommission.
See “Economic conditions” in the “HEI Consolidated” section above.
Executive overview and strategy.  The Utilities provide electricity on all the principal islands in the state, other than Kauai, to approximately 95% of the state’s population and operate five separate grids. The Utilities’ mission is to provide innovative energy leadership for Hawaii, to meet the needs and expectations of customers and communities, and to empower them with affordable, reliable and clean energy. The goal is to create a modern, resilient, flexible and dynamic electric grid that enables an optimal mix of distributed energy resources, such as private rooftop solar, demand response and grid-scale resources to enable the creation of smart, sustainable, resilient communities and achieve the statutory goal of 100% renewable energy by 2045.
Performance-based regulations. On December 23, 2020, the PUC issued a D&O (PBR D&O) approving a new performance-based regulation framework (PBR Framework). See “Regulatory proceedings” under “Commitments and contingencies” in Note 3 of the Condensed Consolidated Financial Statements.
Transition to a decarbonized and sustainable energy future.  The Utilities are fully committed to leading and enabling pathways to a decarbonized and sustainable energy future for Hawaii. The Utilities believe that a holistic approach to decarbonization is needed, and that such a strategy requires achieving the Utilities’ decarbonization and renewable energy commitments, facilitating and promoting beneficial electrification, and deploying carbon removal and offsets among other levers to reduce statewide emissions.
In the fourth quarter of 2021, the Utilities outlined its Climate Action Plan to cut carbon emissions from power generation 70% by 2030, compared to a 2005 baseline. The emissions covered by this goal include stack emissions from generation owned by Hawaiian Electric and IPPs who sell electricity to the Utilities. The 2030 commitment would provide a significant portion of the reduction the entire Hawaii economy needs to meet the U.S. target of cutting carbon emissions by at least 50% economy-wide by 2030. Hawaiian Electric has also committed to achieving net zero carbon emissions from power generation by 2045 or sooner. Key elements of the 2030 plan include the closure of the state’s last coal-fired IPP plant in 2022 upon expiry of the PPA, increasing rooftop solar by more than 50% over 2021 levels, retiring six fossil fuel generating units, adding at least 1 GW of renewable generation to what was already in place in 2021, increasing grid-scale and customer-owned storage, expanding geothermal resources, and creating customer incentives for using clean, lower-cost energy at certain times of the day and using less fossil-fueled energy at night. The retirement of fossil-fueled generating units to achieve the Utilities’ 70% decarbonization goal is consistent with state policy and supported by Hawaii State law. See “Forecast of capital expenditures—Liquidity and capital resources” for a discussion of potential capital expenditures related to decarbonization efforts.
On September 1, 2022, the last coal-fired IPP plant in the state, providing approximately 10% of Oahu’s generation, will cease operations, removing a significant amount of GHG emissions from the Utilities’ generation mix. The plant’s aging infrastructure could lead to more unscheduled outages compared to historic performance, which may impact system reliability.
In anticipation of the retirement of the coal-fired IPP plant, the Utilities have developed plans, including contingency plans, to ensure reliable service through the transition period. These plans include the anticipated addition of ten renewable energy/storage projects, reserve capacity from existing generation sources, the acceleration of maintenance work during periods with anticipated higher reserve levels, and multiple demand response/distributed energy resources programs. However, future events, including unexpected issues with existing generation, or supply chain issues and inflationary pressures, as well as federal policies related to solar panel imports, among other factors, delay in the commercial operation of new generation resources, could disrupt the ability of the Utilities to deliver reliable service. Also, see the “Developments in renewable energy efforts—New renewable PPAs” section below.
Hawaii’s renewable portfolio standard law requires electric utilities to meet an RPS of 40%, 70% and 100% by December 31, 2030, 2040 and 2045, respectively. Hawaii law has also established a target of sequestering more atmospheric
58

carbon and greenhouse gases than emitted within the state by 2045. The Utilities’ strategies and plans are fully aligned in meeting these targets.
The Utilities have made significant progress on the path to clean energy and have been successful in achieving RPS goals. The Utilities reached its 2015 RPS goal two years early and exceeded the 30% RPS target for 2020, achieving an RPS of 34.5% that year. In 2021, the Utilities achieved an RPS of 38.4%. The Utilities will continue to actively procure additional renewable energy post-2021 and expect to meet or exceed the next statutory RPS goal of 40% in advance of the 2030 compliance year. (See “Developments in renewable energy efforts” below).
If the Utilities are not successful in meeting the RPS targets as mandated by law, the PUC could assess a penalty of $20 for every MWh that an electric utility is deficient. Based on the level of electricity sales in 2021, a 1% shortfall in meeting the 2030 RPS requirement of 40% would translate into a penalty of approximately $1.7 million. The PUC has the discretion to reduce the penalty due to events or circumstances that are outside an electric utility’s reasonable control, to the extent the event or circumstance could not be reasonably foreseen and ameliorated. In addition to penalties under the RPS law, failure to meet the mandated RPS targets would be expected to result in a higher proportion of fossil fuel-based generation than if the RPS target had been achieved, which in turn would be expected to subject the Utilities to limited commodity fossil fuel price exposure under a fuel cost risk-sharing mechanism. The fuel cost risk-sharing mechanism apportions 2% of the fuel cost risk to the utilities (and 98% to ratepayers) and has a maximum exposure (or benefit) of $3.7 million. Conversely, the Utilities have incentives under PIMs that provide a financial reward for accelerating the achievement of renewable generation as a percentage of total generation, including customer supplied generation. The Utilities may earn a reward for the amount of system generation above the interpolated statutory RPS goal at $20/MWh in 2022, $15/MWh in 2023, and $10/MWh for the remainder of the multi-year rate period.
The Utilities are fully aligned with, and supportive of, state policy to achieve a decarbonized future and have made significant progress in reducing emissions through renewable energy and electrification. This alignment with state policy is reflected in management compensation programs and the Utilities’ long-range plans, which include aspirational targets in order to catalyze action and accelerate the transition away from fossil fuels throughout its operations at a pace more rapid than dictated by current law. The long-range plans, including aspirational targets, serve as guiding principles in the Utilities’ continued transformation, and are updated regularly to adapt to changing technology, costs, and other factors. While there is no financial penalty for failure to achieve the Utilities’ long-range aspirational objectives, the Utilities recognize that there are environmental and social costs from the continued use of fossil fuels.
The State of Hawaii’s policy is supported by the regulatory framework and includes a number of mechanisms designed to maintain the Utilities’ financial stability during the transition toward the State’s decarbonized future. Under the sales decoupling mechanism, the Utilities are allowed to recover from customers, target test year revenues, independent of the level of kWh sales, which have generally trended lower over time as privately-owned distributed energy resources have been added to the grid and energy efficiency measures have been put into place. Other regulatory mechanisms under the new PBR framework reduce some of the regulatory lag during the multi-year rate plan (MRP), such as the annual revenue adjustment to provide annual changes in utility revenues and the exceptional project recovery mechanism, which allows the Utilities to recover and earn on certain approved eligible projects placed into service. See “Regulatory proceedings” under “Commitments and contingencies” and “Decoupling” in Note 3 of the Condensed Consolidated Financial Statements.
Integrated Grid Planning. Achieving high levels of renewable energy and a carbon free electric system will require modernizing the grid through coordinated energy system planning in partnership with local communities and stakeholders. To accomplish this, the Utilities are implementing an innovative systems approach to energy planning intended to yield the most cost-effective renewable energy and decarbonization pathways that incorporates customer and stakeholder input.
The Integrated Grid Planning (IGP) utilizes an inclusive and transparent Stakeholder Engagement model to provide an avenue for interested parties to engage with the Utilities and contribute meaningful input throughout the IGP process. The IGP Stakeholder Council, Technical Advisory Panel and Working groups have been established and meet regularly to provide feedback and input on specific issues and process steps in the IGP. The Utilities submitted an updated IGP work plan to the PUC in January 2021. In August 2021, the Utilities submitted their Revised Inputs and Assumptions to the PUC for review and approval, marking the significant progress made through the stakeholder engagement phase of the IGP process. On March 31, 2022, the Utilities submitted the final Inputs and Assumptions approved by the PUC. The PUC is currently reviewing the Utilities’ planning methodologies and criteria. Once approved, the next step in the IGP process to complete a Grid Needs Assessment will begin.
Demand response programs. Pursuant to PUC orders, the Utilities are developing an integrated Demand Response (DR) Portfolio Plan that will enhance system operations and reduce costs to customers. The reduction in cost for the customer will take the form of either rates or incentive-based programs that will compensate customers for their participation individually,
59

or by way of engagements with turnkey service providers that contract with the Utilities to aggregate and deliver various grid services on behalf of participating customers and their distributed assets.
On June 9, 2021, the PUC issued an order providing guidance to the third Grid Service RFP filed on February 23, 2021. The proposed Grid Service RFP focused only on Oahu and is seeking 132 MW of grid services with focus on capacity reduction (60 MW) similarly in response to the potential reserve shortfall from the AES coal plant retirement scheduled on September 1, 2022. The Utilities filed a final draft and received PUC approval to proceed on August 3, 2021. The Utilities subsequently issued an approved Grid Services RFP and the bids were due on October 13, 2021. The Utilities made their final selections on November 10, 2021 and commenced negotiations immediately after. The Utilities executed a GSPA for a total grid services amount of 97.4 MW and filed with the PUC to request approval on March 16, 2022.
On June 8, 2021, the PUC approved the new program, Emergency Demand Response Program (EDRP), a battery storage incentive program to dispatch electricity between 6 p.m. to 8 p.m. daily from participating residential and commercial customers, to address the potential reserve shortfalls following the AES coal plant retirement. The PUC approved EDRP for 50MW on Oahu with an incentive budget not to exceed $34 million, which will be recovered via a surcharge cost recovery mechanism over a 10-year amortization. The Utilities’ implementation plan was approved by the PUC on June 30, 2021, and the Utilities subsequently filed the updated EDRP tariffs on July 1, 2021. On February 25, 2022, the PUC approved an amendment to the Battery Bonus program that provides additional incentives to participating customers. This new amendment became effective on March 1, 2022. As of March 31, 2022, the Utilities have received and approved the applications totaling approximately 5 MW.
Grid modernization. The overall goal of the Grid Modernization Strategy is to deploy modern grid investments at an appropriate priority, sequence and pace to cost-effectively maximize flexibility, minimize the risk of redundancy and obsolescence, deliver customer benefits and enable greater distributed energy resources and renewable energy integration. Under the Grid Modernization Strategy, the Utilities expect that new technology will help increase adoption of private rooftop solar and make use of rapidly evolving products, including storage and advanced inverters. On March 25, 2019, the PUC approved a plan for the Utilities to implement Phase 1 of their Grid Modernization Strategy (proportional deployment of advanced metering infrastructure “AMI”). On February 28, 2022, the PUC expanded the scope of Phase 1 AMI to the full service territory with a completion date set for the third quarter of 2024. The estimated cost of full deployment (including proportional deployment) is approximately $143 million in capital and deferred software cost and is expected to be incurred over five years. As of March 31, 2022, approximately $42 million of capital and deferred software cost has been incurred to date under Phase 1 and is currently being recovered under the MPIR mechanism until such costs are included in base rates. On February 14, 2022, the Utilities filed a request with the PUC to increase operations and maintenance costs to reflect the incremental O&M costs associated with full-service territory AMI deployment. To date, the Utilities have deployed over 65,000 advanced meters, or approximately 14% of the total scheduled deployment under Phase 1.
The Utilities filed an application with the PUC on September 30, 2019 for an Advanced Distribution Management System (ADMS) as part of the second phase of their Grid Modernization Strategy implementation. However, on December 30, 2019, the PUC suspended the Utilities’ application for the Advanced Distribution Management System pending the Utilities’ filing of a supplemental application for the broad deployment of field devices. This supplement and update to the Grid Mod Phase 2 field devices application was filed on March 31, 2021. The estimated cost for the implementation over five years of the ADMS and field devices, which includes capital, deferred software costs and O&M costs, is $105 million. A PUC order was issued on April 27, 2021, unsuspending and resuming consideration of the Phase 2 Application. The Utilities filed the reply statement of position on October 15, 2021, completing the discovery phase of the docket. On November 16, 2021, the PUC suspended the Utilities’ ADMS and Phase 2 field device application to focus the Utilities’ attention on completing Phase 1. The Utilities filed a Motion for Reconsideration with the PUC in response to the suspension, but was denied. The PUC subsequently clarified that the Utilities may resume the Phase 2 docket no earlier than six months before Phase 1 is scheduled to be completed, which is the third quarter of 2024. Resumption of the Phase 2 proceeding would likely commence six months prior to this completion date selected by the PUC.
Community-based renewable energy. In December 2017, the PUC adopted a community-based renewable energy (CBRE) program framework which allows customers who cannot, or chose not to, take advantage of private rooftop solar to receive the benefits of renewable energy to help offset their monthly electric bills and support clean energy for Hawaii. The program has two phases.
The first phase, which commenced in July 2018, totals 8 MW of solar photovoltaic (PV) only with one credit rate for each island, closed on April 9, 2020. Two phase 1 projects (28.32 kW on Maui and 270 kW on Oahu) have been operational for over a year, with four additional phase 1 projects expected to become operational in 2023.
The second phase, which commenced on April 9, 2020 and subsequently expanded on July 27, 2021, allows over 250 MW across all Hawaiian Electric service territories in two tranches for small (under 250 kW), mid-tier and large system sizes
60

to encourage a variety of system sizes. To provide opportunities for LMI customers to participate in the program, separate project proposals may be submitted specifically targeting LMI customers.
Eight RFPs were required by order: one each for Oahu, Maui, Hawaii Island, Molokai, and Lanai, and LMI-specific RFPs for Oahu, Maui, and Hawaii Island. LMI projects do not have a size cap nor do they decrease the 250 MW capacity available to other projects.
For Lanai, the Utilities proposed to combine the previously issued Variable Renewable Dispatchable Generation Paired with Energy Storage RFP and the CBRE RFP to optimize the benefits of procuring renewable energy, spurring development and increasing the likelihood of success of the CBRE Program on Lanai. See “Developments in renewable energy efforts–Requests for renewable proposals, expressions of interest, and information” for additional information.
CBRE proposals for Lanai were due on February 14, 2022 and are currently being evaluated. CBRE proposals due date for Molokai was extended until March 1, 2022 and are currently being evaluated. On March 17, 2022 the CBRE LMI RFPs for Oahu, Maui and Hawaii were issued and are currently accepting proposals until May 17, 2022. The Utilities issued the CBRE Tranche 1 RFPs for Oahu, Maui and Hawaii on April 14, 2022 and will accept proposals for these RFPs through August 17, 2022.
The Utilities CBRE Phase 2 Rule 29 became effective on March 10, 2022. The Utilities are currently accepting project applications for small CBRE projects less than 250 kW in size. The PUC reserved 45 MW as well as a small amount of unallocated capacity from Phase 1 for small projects in Phase 2 on Oahu, Maui and Hawaii Island. The Utilities have developed a CBRE Portal where Subscriber Organizations can apply for small project capacity and manage subscribers for all CBRE projects in the program. Customers can also use the portal to subscribe to a project once the Subscriber Organization has added their project to the portal.
Microgrid services tariff proceeding. In enacting Act 200 of 2018, the Hawaii legislature found that Hawaii’s residents and businesses were vulnerable to disruptions in the islands’ energy systems caused by extreme weather events or other disasters, and stated its belief that the use of microgrids would build energy resiliency into Hawaii’s communities, thereby increasing public safety and security. The purpose of Act 200 was therefore to encourage and facilitate the development and use of microgrids through the establishment of a standard microgrid services tariff. In July 2018, pursuant to Act 200, the PUC opened a proceeding to investigate the establishment of a microgrid services tariff. In August 2019, the PUC issued an order prioritizing items for resolution in the docket and directed the Parties to establish working groups (the “Working Group”) to address issues identified by the PUC.
On May 27, 2021, the Utilities filed the Microgrid Service Tariff. On September 21, 2021, the PUC provided guidance for Phase 2 of the Microgrid Tariff proceeding, specifically identifying the objective for Phase 2 to promote self-sufficiency and resilience among microgrid project operators, as well as to further streamline the Microgrid Services Tariff where applicable. Furthermore, the PUC instructed Parties to recommend priority topics, along with supporting rationale to better inform the topics that will be discussed during this phase of the proceeding, which the parties submitted by October 21, 2021.
On April 4, 2022, the PUC established its Prioritized Issues for Resolution in for Phase 2 of the Microgrid proceeding, which includes the following: 1) Microgrid Compensation and Grid Services; 2) Utility Compensation; 3) Customer Protection and Related Considerations; 4) Interconnection; and 5) Working group coordination with related microgrid and resilience Initiatives at Hawaiian Electric and government agencies. Furthermore, the PUC established a procedural schedule to consist of quarterly status conference meetings with the PUC, a Phase 2 Working Group Report, draft of a revised Microgrid Service Tariff, Party comments to the proposed Microgrid Service Tariff, followed by a PUC D&O.
Decoupling. See “Decoupling” in Note 3 of the Condensed Consolidated Financial Statements for a discussion of decoupling.
Regulated returns. As part of the PBR Framework’s annual review cycle, the Utilities track their rate-making ROACEs as calculated under the earnings sharing mechanism, which includes only items considered in establishing rates. At year-end, each utility’s rate-making ROACE is compared against its ROACE allowed by the PUC to determine whether earnings sharing has been triggered. The D&O in the PBR proceeding modified the earnings sharing mechanism to a symmetric arrangement. Effective with annual earnings for 2021, the earnings sharing will be triggered for achieved rate-making ROACE outside of a 300 basis points dead band above and below the current authorized rate-making ROACE of 9.5% for each of the Utilities. Earnings sharing credits or recoveries will be included in the biannual report (formally known as annual decoupling filing) to be filed with the PUC in the spring of the following year. Results for 2021, 2020 and 2019 did not trigger the earnings sharing mechanism for the Utilities.
61

Actual and PUC-allowed returns, as of March 31, 2022, were as follows:
%Rate-making Return on rate base (RORB)*ROACE**Rate-making ROACE***
Twelve months ended 
March 31, 2022
Hawaiian ElectricHawaii Electric LightMaui ElectricHawaiian ElectricHawaii Electric LightMaui ElectricHawaiian ElectricHawaii Electric LightMaui Electric
Utility returns7.30 6.01 6.68 8.60 6.66 7.50 9.61 7.41 8.58 
PUC-allowed returns7.37 7.52 7.43 9.50 9.50 9.50 9.50 9.50 9.50 
Difference(0.07)(1.51)(0.75)(0.90)(2.84)(2.00)0.11 (2.09)(0.92)
*      Based on recorded operating income and average rate base, both adjusted for items not included in determining electric rates.
**    Recorded net income divided by average common equity.
***  ROACE adjusted to remove items not included by the PUC in establishing rates, such as incentive compensation.
The factors contributing to the difference between PUC-allowed ROACEs and the ROACEs actually achieved prior to the establishment of PBR include the exclusion of certain expenses from rates (for example, incentive compensation and charitable contributions), the recognition of annual RAM revenues on June 1 annually rather than on January 1, and return on capital additions since the last rate case in excess of indexed escalations. As a result of the D&O in the PBR proceeding, the Utilities are allowed to recognize previously established RAM adjustment and ARA revenues on January 1 of each year.
Regulatory proceedings.  On December 23, 2020, the PBR D&O was issued, establishing a new PBR Framework. The PBR Framework implemented a five-year multi-year rate period (MRP), during which there will be no general rate case applications. In the fourth year of the MRP, the PUC will comprehensively review the PBR Framework to determine if any modifications or revisions are appropriate. See also “Regulatory proceedings” in Note 3 of the Condensed Consolidated Financial Statements.
Developments in renewable energy efforts.  Developments in the Utilities’ efforts to further their renewable energy strategy include renewable energy projects discussed in Note 3 of the Condensed Consolidated Financial Statements and the following:
New renewable PPAs.
•On December 31, 2019, Hawaii Electric Light and PGV entered into an Amended and Restated Power Purchase Agreement (ARPPA). The ARPPA extends the term of the existing PPA by 25 years to 2052, expands the firm capacity of the facility to 46 MW and delinks the pricing for energy delivered from the facility from fossil fuel prices to reduce cost to customers. On March 31, 2021, the PUC suspended the docket pending the completion of a supplemental environmental review under the Hawaii Environmental Policy Act (HEPA). After the Office of Planning and Sustainable Development identified the Planning Department for the County of Hawaii to be the accepting agency and approving authority for any required HEPA review, the PUC lifted the suspension of the docket stating that the docket was ready for decision-making. On March 16, 2022, the PUC issued a D&O, approving the ARPPA, subject to conditions, that include requiring completion of the final environmental review prior to construction. On March 28, 2022, Puna Pono Alliance filed a Motion for Reconsideration seeking reconsideration, modification and/or vacation of the D&O.
•The Utilities’ renewable energy goals depend, in large part, on the success of renewable projects developed and operated by independent power producers. Beginning in 2017, the Utilities embarked on an ambitious procurement effort, selecting multiple solar plus storage efforts to help reach the Utilities renewable portfolio standards goals as well as to assist the Utilities in retiring fossil fuel generation. Several of the recently procured projects have experienced delays and four Stage 2 projects have been declared null and void by the independent power producers due to a number of issues, including supply chain disruptions caused by impacts from the COVID-19 pandemic, solar product detentions at U.S. ports of entry ordered by the U.S. Customers and Border Protection agency, and unforeseen site conditions which resulted in unanticipated project costs or in some cases the inability to effectively use previously identified project sites. Projects have also indicated potential impacts from the investigation launched by the US Department of Commerce on March 28, 2022, in response to a request by Auxin Solar Inc. in regards to solar panel imports. Significant project delays or failures of these projects increase the risk of the Utilities not meeting the renewable portfolio standards or other climate related goals, eligibility for performance incentive mechanisms associated with the speed of increasing renewable generation, and the ability to retire fossil fuel units.
Tariffed renewable resources.
•As of March 31, 2022, there were approximately 554 MW, 119 MW and 133 MW of installed distributed renewable energy technologies (mainly PV) at Hawaiian Electric, Hawaii Electric Light and Maui Electric, respectively, for tariff-based private customer generation programs, namely Standard Interconnection Agreement, Net Energy
62

Metering, Net Energy Metering Plus, Customer Grid Supply, Customer Self Supply, Customer Grid Supply Plus and Interim Smart Export. As of March 31, 2022, an estimated 33% of single family homes on the islands of Oahu, Hawaii and Maui have installed private rooftop solar systems, and approximately 20% of the Utilities’ total customers have solar systems.   
•The Utilities began accepting energy from feed-in tariff projects in 2011. As of March 31, 2022, there were 43 MW, 2 MW and 6 MW of installed feed-in tariff capacity from renewable energy technologies at Hawaiian Electric, Hawaii Electric Light and Maui Electric, respectively.
Biofuel sources.
•In July 2018, the PUC approved Hawaiian Electric’s three-year biodiesel supply contract with Pacific Biodiesel Technologies, LLC (PBT) to supply 2 million to 4 million gallons of biodiesel at Hawaiian Electric’s Schofield Generating Station and the Honolulu International Airport Emergency Power Facility and any other generating unit on Oahu, as necessary. The PBT contract became effective on November 1, 2018 and has been extended for one year through December 2022. Hawaiian Electric also has a spot buy contract with PBT to purchase additional quantities of biodiesel at or below the price of diesel. Some purchases of “at parity” biodiesel have been made under the spot purchase contract, which was extended through June 2023. On June 30, 2021, the Utilities issued an RFP for all fuels, including biodiesel, for supply commencing January 1, 2023. The Utilities and PBT signed an agreement on December 13, 2021 for supply of biodiesel on all islands commencing January 1, 2023, subject to PUC approval.
•Hawaiian Electric has a contingency supply contract with REG Marketing & Logistics Group, LLC to also supply biodiesel to any generating unit on Oahu in the event PBT is not able to supply necessary quantities. This contingency contract has been extended to November 2023, and will continue with no volume purchase requirements.
Requests for renewable proposals, expressions of interest, and information.
•Under a request for proposal process governed by the PUC and monitored by independent observers, in February 2018, the Utilities issued Stage 1 Renewable RFPs for 220 MW of renewable generation on Oahu, 50 MW of renewable generation on Hawaii Island, and 60 MW of renewable generation on Maui. To date, summarized information for a total of 8 PPAs is as follows:
UtilitiesNumber of contractsTotal photovoltaic size (MW)BESS Size (MW/MWh)Guaranteed commercial operation datesContract term (years)Total projected annual payment (in millions)
Hawaiian Electric4139.5139.5/5587/31/22, 9/30/22, 1/20/23 &8/31/2320 & 25$32.2 
Hawaii Electric Light26060/24011/3/22 & 12/2/222514.1 
Maui Electric27575/3004/28/23 & 10/27/232517.6 
Total8274.5274.5/1,098$63.9 
The Utilities have received PUC approvals to recover the total projected annual payment of $63.9 million for the eight PPAs through the PPAC to the extent such costs are not included in base rates. On March 29, 2022, the Utilities filed a letter with the PUC requesting approval of an amendment requesting a price and guaranteed commercial operation date change to a previously-approved PPA for Stage 1 on Oahu to resolve a force majeure condition. On May 6, 2022, the PUC conditionally approved this PPA amendment.
•In continuation of their February 2018 request for proposal process, the Utilities issued their Stage 2 Renewable RFPs for Oahu, Maui and Hawaii Island and Grid Services RFP on August 22, 2019. Final awards for the renewable projects were made on May 8, 2020. Final awards for the grid services projects were made starting in January 2020. On Oahu, seven solar-plus-storage projects and one standalone storage project, totaling approximately 281 MW of generation and 1.8 GWh of storage, were selected. On Maui, three solar-plus-storage projects and one standalone storage project, totaling approximately 100 MW of generation and 560 MWh of storage, were selected. On Hawaii Island, two solar-plus-storage projects and one standalone storage project, totaling approximately 72 MW of generation and 492 MWh of storage, were selected. Two Utility Self-Build projects were among those selected; a 40-MW, 160-MWh standalone energy storage system on Maui and a 12-MW, 12-MWh storage system on Hawaii Island. Three renewable plus storage projects voluntarily withdrew from the process prior to execution of a power purchase agreement for various reasons, including change in circumstances for the developer and a misunderstanding of contract requirements. To date, the Utilities had filed 11 PPAs, including 4 PPAs declared null and void by the independent power producers, 2 GSPAs and 2 applications for commitments of funds for capital
63

expenditures for approval of the utility self-build projects with the PUC. On March 23, 2022, the PUC approved one solar-plus-storage project on Oahu for 15 MW of generation and 60 MWh of storage.
A summary of the 7 PPAs that are still under active development, is as follows:
UtilitiesNumber of contractsTotal photovoltaic size (MW)BESS Size (MW/MWh)Guaranteed commercial operation datesContract term (years)Total projected annual payment (in millions)
Hawaiian Electric49494/5035/17/23, 10/30/23, 12/29/23 & 4/9/202420 & 25$32.9 
Hawaiian Electric1*N/A185/56512/30/222024.0 
Maui Electric26060/2407/25/23 & 12/29/232518.2 
Total7154339/1,308$75.1 
* See further discussion under “Review of Interconnection Process and Kapolei Energy Storage Power Purchase Agreement” below.
To date, six projects that have been approved by the PUC remain in development – five solar-plus-storage PPAs (112 MW) and one standalone storage PPA (185 MW). The total projected annual payment of $63.5 million for these PPAs will be recovered through the PPAC to the extent such costs are not included in base rates. On February 15, 2022, the Utilities filed letters with the PUC requesting approval of amendments to two of the previously-approved PPAs for Stage 2, one on Oahu and one on Maui, that address delays and price increase due to the COVID-19 pandemic and the global supply-chain crisis, as well as other market conditions that have arisen during the development of these projects. On March 2, 2022, the PUC declined to approve both amendments. On March 14, 2022, both the developer of the project and the Utilities filed a motion for reconsideration for one project, and the developer also filed a motion for reconsideration for the second project. On May 5, 2022, the developer withdrew its motions for reconsideration for both projects and on May 6, 2022, the Utilities withdrew their motion for reconsideration and filed the developer’s notices declaring PPAs for the projects null and void. On May 6, 2022, after the developer declared the PPAs null and void, the PUC granted the Utilities’ motion for reconsideration, approving the amendment to the Maui based project. However, the PUC’s order does not change the developer’s null and void declaration of the PPA for the Maui based project. The PPA remains null and void at this time.
A summary of the GSPAs that were approved by PUC in December 2020 is as follows:
UtilitiesFast Frequency Response - 1
(MW)		Fast Frequency Response - 2
(MW)		Capacity -
Load Build
(MW)		Capacity -
Load Reduction
(MW)
Hawaiian Electric—26.714.519.4
Hawaii Electric Light6.0—3.24.0
Maui Electric6.1—1.94.7
Total12.126.719.628.1
A summary of the utility self-build projects that are pending PUC approval is as follows:
UtilitiesNumber of contractsBESS Size (MW/MWh)Guaranteed commercial operation dates
Hawaii Electric Light112/1212/30/22
Maui Electric140/1604/28/23
Total252/172
•On November 27, 2019, the Utilities issued RFPs for renewable generation paired with energy storage on the islands of Lanai and Molokai. The Utilities were seeking PV paired with storage or small wind (specified as 100 kW turbines or smaller) on Molokai and PV paired with storage on Lanai. The RFP on Lanai was postponed on January 14, 2020 to allow the Utility to re-evaluate the scope of the RFP in response to announced plans to remove two large resorts from the grid. Proposals for the Molokai RFP were received on February 14, 2020. In light of a PUC order issued on April 9, 2020 in the CBRE docket, the Utilities proposed in their July 9, 2020 filing to combine the previously issued and subsequently postponed Lanai RFP with the CBRE RFP described in the order to optimize the benefits of procuring renewable energy, spurring development and increasing the likelihood of success of the CBRE program on Lanai. On May 21, 2021, the PUC approved the proposed combined Lanai RFP. On October 15, 2020, the Utilities selected one project from the Molokai RFP for a total of 4.5 MW of solar and 24 MWh of storage. The developer, however, declined to accept the award. On August 25 and 31, 2021, the Utilities filed proposed final drafts of the CBRE RFPs, which included three dedicated Low-to-Moderate-Income RFPs on Oahu, Maui and Hawaii, three Tranche 1 RFPs on Oahu, Maui and Hawaii, a Molokai CBRE RFP, and a combined Lanai Variable
64

and CBRE RFP. On November 22, 2021, CBRE RFPs for Molokai and Lanai were opened. The Lanai RFP closed on February 14, 2022 and the Molokai RFP closed on March 1, 2022. A project has been selected in the Lanai RFP. Proposals are currently being evaluated in the Molokai RFP. On February 8, 2022, the PUC approved, subject to modifications, the CBRE and LMI CBRE RFPs for Oahu, Maui, and Hawaii Island. The Utilities filed the final RFPs with the PUC on February 23, 2022. On March 17, 2022, the CBRE LMI RFPs for Oahu, Maui and Hawaii were opened. The Utilities opened the CBRE Tranche 1 RFPs for Oahu, Maui and Hawaii on April 14, 2022. See “Transition to a decarbonized and sustainable energy future—Community-based renewable energy” for additional information.
•The PUC issued a letter to the Utilities requesting development with a Stage 3 RFP on Hawaii Island on January 21, 2021. In accordance with guidance provided by the PUC in a subsequent letter on April 20, 2021, the Utilities filed the Hawaii Island Grid Needs Assessment on July 15, 2021 and the draft RFP, including model contracts for PV+BESS, wind+BESS, standalone storage, firm renewable generation, and distributed energy resources aggregators on October 15, 2021. The requirements in the Stage 3 RFP are guided by the results of the Grid Needs Assessment. On March 18, 2022, the Utilities filed a second draft of the Stage 3 RFP for Hawaii Island, incorporating stakeholder and PUC feedback.
•On February 18, 2022, the PUC sent a letter to the Utilities directing them to develop Stage 3 RFPs for Oahu and Maui. On March 10, 2022, the Utilities submitted its recommendations on plans to develop Stage 3 RFPs for Oahu and Maui, and on May 2, 2022, the Utilities filed draft RFPs for Oahu and Maui. For Oahu, the Utilities are seeking 500 to 700 MW of renewable firm capacity, and at least 475 GWh of renewable dispatchable energy annually. For Maui, the Utilities are procuring at least 40 MW of renewable firm capacity, and at least 180 GWh of renewable dispatchable energy annually.
•On November 17, 2021, the Utilities filed a request with the PUC to develop an RFP for firm renewable generation for Oahu. On December 22, 2021, the PUC issued guidance to the Utilities on proceeding with such RFP. The Utilities filed a draft RFP on February 28, 2022. Per the PUC’s March 23, 2022 letter, the Utilities will pursue firm renewable generation as a part of the Stage 3 Oahu RFP.
Review of Interconnection Process and Kapolei Energy Storage Power Purchase Agreement.
•In February 2021, the PUC initiated a docket for the purposes of reviewing the status and interconnection progress of various utility-related renewable projects (i.e., Stage 1 and Stage 2 RFP PPAs and CBRE) and the Utilities’ transition plans for the expiration of the AES power purchase agreement, the retirement of the Kahului Power Plant, and other fossil fuel power plant transition plans, as needed. The Utilities filed initial status updates on the project timelines, steps needed for each of the renewable projects to achieve commercial operation and steps the Utilities are taking to address projected extensions of guaranteed commercial operation dates (GCOD) for renewable projects under development, which are due to a variety of factors, including those outside of the control of the Utilities. The PUC subsequently held status conferences on the Utilities’ updates. In April 2021, the PUC issued an Order directing the Utilities to establish regulatory liabilities for the difference between the on-peak avoided cost and the unit price included in the applications for approval of the renewable project PPAs, effective with the GCOD included in the applications (the earliest GCOD included in the applications is July 2021) or from the date of the Order for CBRE Phase 1 projects. The amount of regulatory liabilities to be recorded in future periods are not determinable at this time and would be affected by a number of factors, including the length of the GCOD extension period, the monthly on-peak avoided cost, as well as the factors described above. The Utilities filed a Motion for Reconsideration of the entire Order, or in the alternative to clarify that at most the PUC is directing the Utilities to track the information and not record the information at this time. The Utilities further requested a Stay of the Order pending resolution of the Motion. The Utilities maintain that extensions of GCODs are allowed under the PUC-approved contracts and that the Order has the unintended consequence of imposing penalties against the Utilities without due process. In May 2021, the PUC issued an order clarifying its Order and directed the Utilities to track costs to consumers caused by the perceived delay of renewable projects, and that the PUC does not intend to, at this time, impose any penalties on the Utilities. The Utilities report the tracked cost on a monthly basis. The full text of the Order, Motion for Reconsideration and request for a Stay of the Order, and clarification Order as well as the tracked costs can be found on the PUC website at dms.puc.hawaii.gov/dms (Docket No. 2021-0024).
•Also in April 2021, the PUC approved the Kapolei Energy Storage (KES) PPA (one of the PPAs as a result of the Stage 2 Renewable RFP process) (KES Decision and Order), subject to nine conditions, including the Utilities forgoing the second portion of the PIM rewards amounting up to $1.7 million for the Stage 1 RFP PPAs, removing grid constraints for the Utilities’ CBRE Phase 2 projects and for existing and new distributed energy programs, financial retirement of Hawaiian Electric generating units by specified dates and adjusting target revenues at the retirement dates for such retirements, and a requirement to charge the batteries in the project using significant levels
65

of renewable energy generation. The financial retirement of the generating units described in the KES Decision and Order is contrary to the intent of Hawaii Revised Statutes §269-6(d), which encourages the recovery of stranded costs for the retirement of fossil fuel generation, and contrary to the regulatory compact under which in return for agreeing to commit capital necessary to allow utilities to meet their obligation to serve, utilities are assured recovery of their investment and a fair opportunity to earn a reasonable return on the capital prudently committed to the business. Hawaiian Electric filed a Motion for Reconsideration and Stay of the Decision and Order due to potentially significant financial and operational impacts. In May 2021, the PUC granted, in part, Hawaiian Electric’s Motion for Reconsideration and Stay. In this Order, the PUC addressed a number of Hawaiian Electric’s concerns, including removing the condition of the Utilities foregoing the PIM award from Stage 1 RFP projects, agreeing to address grid constraint concerns in respective DER and CBRE dockets and not in the KES docket, removing the minimum thresholds of charging energy coming from renewable energy generation and corresponding deadlines associated with these thresholds and modifying the condition on financial retirement of generating units. The PUC indicated the net book value of generating assets would be addressed at the time of retirement. The full text of the KES Decision and Order and the Motion for Reconsideration and Stay with respect thereto, and the Order granting, in part, Hawaiian Electric’s Motion for Reconsideration can be found on the PUC website at dms.puc.hawaii.gov/dms (Docket No. 2020-0136).
Legislation and regulation. Congress and the Hawaii legislature periodically consider legislation that could have positive or negative effects on the Utilities and their customers. Also see “Environmental regulation” in Note 3 of the Condensed Consolidated Financial Statements.
Fuel contracts. The fuel contract entered into in January 2019, by the Utilities and PAR Hawaii Refining, LLC (PAR Hawaii), for the Utilities’ low sulfur fuel oil (LSFO), high sulfur fuel oil (HSFO), No. 2 diesel, and ultra-low sulfur diesel (ULSD) requirements was approved by the PUC, and became effective on April 28, 2019 and terminates on December 31, 2022. This contract is a requirement contract with no minimum purchases. If PAR Hawaii is unable to provide LSFO, HSFO, diesel and/or ULSD the contract allows the Utilities to purchase LSFO, HSFO, diesel and/or ULSD from another supplier.
On June 9, 2020, the Utilities and PAR Hawaii entered into a First Amendment to the fuel contract. The First Amendment amends only the LSFO pricing to create a two-tiered structure based on volume, with all tier-1 LSFO up to the tier-1 maximum to be purchased exclusively from PAR Hawaii at the established pricing, and purchases in excess of that volume (tier-2) either from PAR Hawaii at the established pricing, or from an alternative supplier. On August 4, 2020, the PUC approved the First Amendment, which has an effective date of July 15, 2020, on an interim basis. The PUC’s approval order allows the recovery of such costs associated with the First Amendment through the ECRC to the extent that the costs are not recovered in base rates. The PUC intends to review whether the First Amendment is reasonable and in the public interest in the final decision, but it will not subject the recovery of the costs between the interim decision and the final decision to retroactive disallowances. On July 6, 2021, the PUC issued a D&O, approving the First Amendment and requiring the Utilities to meet certain conditions of approval (COA). The Utilities are currently addressing the COAs as required in the D&O.
On June 30, 2021, the Utilities issued two RFPs for all fuels for supply commencing January 1, 2023. On February 1, 2022, the Utilities and PAR Hawaii entered into a fuel supply contract commencing January 1, 2023 and Second Amendment to the existing fuel contract to amend tier-1 volumes. The Second Amendment will take effect contingent upon PUC’s approval. The costs incurred under the contract with PAR Hawaii are recovered in the Utilities’ respective ECRCs.
On March 3, 2022, as part of economic sanctions amid the Russia-Ukraine war, Par Hawaii announced that it is suspending all purchases of Russian crude oil, which accounts for at least 25% of Hawaii’s supply. The average fuel oil cost per barrel has increased 62% quarter over quarter and the Utilities is forecasting an approximate 10% increase in the average electric bill for the island of Oahu and approximate 20% average increase for Hawaii and Maui Island.
Army privatization. On October 30, 2020, the PUC approved Hawaiian Electric’s 50-year contract with the U.S. Army to own, operate and maintain the electric distribution system serving the U.S. Army’s 12 installations on Oahu, including Schofield Barracks, Wheeler Army Airfield, Tripler Army Medical Center, Fort Shafter, and Army housing areas. On March 1, 2022, Hawaiian Electric acquired the Army’s existing distribution system for a purchase price of $14.5 million, and will pay the Army in the form of a monthly credit against the monthly utility services charge over the 50-year term of the contract. The acquisition of additional assets contemplated in the contract, with an estimated value of $4 million, is planned for 2023.
Hawaiian Electric took ownership and all responsibilities for operation and maintenance of the system on March 1, 2022 for a 50-year term after a one-year transition period. Under the contract, Hawaiian Electric will make initial capital upgrades over the first six years of the contract and replace aging infrastructure over the 50-year term. In addition to its regular monthly electricity bill, the Army will pay Hawaiian Electric a monthly utility services charge to cover operations and maintenance expenses and provide recovery for capital upgrades, capital replacements, and the existing distribution system
66

based on a rate of return determined by the PUC for regulated utility investments, as well as depreciation expense. A preliminary assessment estimated the capital needs of approximately $40 million in the first six years of the contract. The PUC requires Hawaiian Electric to file regular periodic reports on the activities and investments in fulfillment of the contract and will review the major projects planned on behalf of the Army. The annual impact on Hawaiian Electric’s earnings is not expected to be material and will depend on a number of factors, including the amount and timing of capital upgrades and capital replacement.
FINANCIAL CONDITION
Liquidity and capital resources. As of March 31, 2022, there were no amounts outstanding on Hawaiian Electric’s revolving credit facility and $6 million of commercial paper borrowings outstanding by the Utilities. The total amount of available borrowing capacity under the Utilities’ committed line of credit was $200 million.
Hawaiian Electric expects that its liquidity will continue to be moderately impacted at the Utilities due to lingering COVID-19 impacts to the local economy. Compared to pre-pandemic levels, delinquent accounts receivable balances have increased, which could result in higher write-offs in the future, and kWh sales have generally declined until recently, both of which impact the timing of cash flows and creates higher working capital requirements. However, the Utilities’ liquidity and access to capital remains adequate and is expected to remain adequate. As of March 31, 2022, the total amount of available borrowing capacity (net of commercial paper outstanding) under the Utilities’ committed lines of credit and cash and cash equivalents was approximately $223 million.
The moratorium on customer disconnections was lifted on May 31, 2021. Starting in the third quarter of 2021, the Utilities commenced the disconnection process on a tiered basis, targeting the oldest and largest balances first, which is expected to reduce delinquent accounts receivable balances over time and accelerate cash collections.
Hawaiian Electric’s consolidated capital structure was as follows:
(dollars in millions)March 31, 2022December 31, 2021
Short-term borrowings$6 — %$— — %
Long-term debt, net1,677 42 1,676 42 
Preferred stock34 1 34 1 
Common stock equity2,277 57 2,262 57 
$3,994 100 %$3,972 100 %

Information about Hawaiian Electric’s commercial paper borrowings, borrowings from HEI and line of credit facility were as follows:
 Average balanceBalance
(in millions)Three months ended March 31, 2022March 31, 2022December 31, 2021
Short-term borrowings1
   
Commercial paper$13 $6 $— 
Borrowings from HEI— — — 
Line of credit draws on revolving credit facility— — — 
 
1   The maximum amount of external short-term borrowings by Hawaiian Electric during the first three months of 2022 was approximately $41 million. As of March 31, 2022, Hawaii Electric Light had short-term borrowings from Hawaiian Electric of $5 million and Hawaiian Electric had short-term borrowings from Maui Electric of $12.8 million, which intercompany borrowings are eliminated in consolidation.
Credit agreement. On February 18, 2022, the PUC approved Hawaiian Electric’s request to extend the term of the $200 million Hawaiian Electric revolving credit facility to May 14, 2026. In addition to extending the term, Hawaiian Electric also received PUC approval to exercise its options of two one-year extensions of the commitment termination date and to increase its aggregate revolving commitment amount from $200 million to $275 million, should there be a need. Hawaiian Electric has a $200 million line of credit facility with no amount outstanding at March 31, 2022.
SPRBs. Special purpose revenue bonds (SPRBs) have been issued by the Department of Budget and Finance of the State of Hawaii (DBF) to finance (and refinance) capital improvement projects of Hawaiian Electric and its subsidiaries, but the sources of their repayment are the non-collateralized obligations of Hawaiian Electric and its subsidiaries under loan agreements and notes issued to the DBF, including Hawaiian Electric’s guarantees of its subsidiaries’ obligations.
On May 24, 2019, the PUC approved the Utilities’ request to issue SPRBs in the amounts of up to $70 million, $2.5 million and $7.5 million for Hawaiian Electric, Hawaii Electric Light and Maui Electric, respectively, prior to June 30, 2020,
67

to finance the Utilities’ capital improvement programs. Pursuant to this approval, on October 10, 2019, the DBF issued, at par, Series 2019 SPRBs in the aggregate principal amount of $80 million with a maturity of October 1, 2049. As of March 31, 2022, Hawaiian Electric had $2.1 million of undrawn funds remaining with the trustee. Hawaii Electric Light and Maui Electric have no undrawn funds.
On June 10, 2019, the Hawaii legislature authorized the issuance of up to $700 million of SPRBs ($400 million for Hawaiian Electric, $150 million for Hawaii Electric Light and $150 million for Maui Electric), with PUC approval, prior to June 30, 2024, to finance the Utilities’ multi-project capital improvement programs (2019 Legislative Authorization).
On February 9, 2021, the PUC approved the Utilities’ request to issue SPRBs (up to $100 million, $35 million and $45 million for Hawaiian Electric, Hawaii Electric Light and Maui Electric, respectively) through 2022, with the proceeds to be used to finance the Utilities’ multi-project capital improvement programs. The PUC also approved the use of the expedited approval procedure to request the issuance and sale of the remaining/unused amount of SPRBs authorized by the 2019 Legislative Authorization (i.e., total not to exceed up to $400 million for Hawaiian Electric, up to $150 million for Hawaii Electric Light, and up to $150 million for Maui Electric) during the period January 1, 2023 through June 30, 2024.
Taxable debt. On January 31, 2019, the Utilities received PUC approval (January 2019 Approval) to issue the remaining authorized amounts under the PUC approval received in April 2018 (April 2018 Approval) in 2019 through 2020 (Hawaiian Electric up to $205 million and Hawaii Electric Light up to $15 million of taxable debt), as well as a supplemental increase to authorize the issuance of additional taxable debt to finance capital expenditures, repay long-term and/or short term debt used to finance or refinance capital expenditures, and/or to reimburse funds used for payment of capital expenditures, and to refinance the Utilities’ 2004 junior subordinated deferrable interest debentures (QUIDS) prior to maturity. In addition, the January 2019 Approval authorized the Utilities to extend the period to issue additional taxable debt from December 31, 2021 to December 31, 2022. The new total “up to” amounts of taxable debt requested to be issued through December 31, 2022 are $410 million, $150 million and $130 million for Hawaiian Electric, Hawaii Electric Light and Maui Electric, respectively.
As of March 31, 2022, Hawaiian Electric, Hawaii Electric Light, and Maui Electric have $135 million, $85 million, and $45 million, respectively, of remaining taxable debt to issue prior to December 31, 2022. See summary table below.
(in millions)Hawaiian ElectricHawaii Electric LightMaui Electric
Total “up to” amounts of taxable debt authorized through 2022$410 $150 $130 
Less:
Taxable debt authorized and issued in 2018 under April 2018 Approval75 15 10 
Taxable debt issuance to refinance the 2004 QUIDS in 201930 10 10 
Taxable debt issuance in May 2020110 10 40 
Taxable debt executed in October 2020, but issued on January 14, 202160 30 25 
Remaining authorized amounts $135 $85 $45 
On May 3, 2022, the Utilities received PUC approval through the expedited approval process to issue taxable debt (Hawaiian Electric up to $50 million, Hawaii Electric Light up to $30 million and Maui Electric up to $35 million) prior to December 31, 2022.
On April 29, 2022, the Utilities requested PUC approval to issue, over a four-year period from January 1, 2023 to December 31, 2026, unsecured obligations bearing taxable interest (Hawaiian Electric up to $230 million, Hawaii Electric Light up to $65 million and Maui Electric up to $105 million), to finance capital expenditures, repay long-term and/or short-term debt used to finance or refinance capital expenditures, and/or to reimburse funds used for payment of capital expenditures.
Equity. In October 2018, the Utilities received PUC approval for the supplemental increase to issue and sell additional common stock in the amounts of up to $280 million for Hawaiian Electric and up to $100 million each for Hawaii Electric Light and Maui Electric, with the new total “up to” amounts of $430 million for Hawaiian Electric and $110 million each for Hawaii Electric Light and Maui Electric, and to extend the period authorized by the PUC to issue and sell common stock from December 31, 2021 to December 31, 2022. As of March 31, 2022, Hawaiian Electric, Hawaii Electric Light, and Maui Electric have $221.4 million, $93.7 million, and $63.2 million, respectively, of remaining common stock to issue prior to December 31, 2022. See summary table below.
68

(in millions)Hawaiian ElectricHawaii Electric LightMaui Electric
Total “up to” amounts of common stock authorized to issue and sell through 2021$150.0 $10.0 $10.0 
Supplemental increase authorized280.0 100.0 100.0 
Total “up to” amounts of common stock authorized to issue and sell through 2022430.0 110.0 110.0 
Less: Common stock authorized and issued in 2017, 2018, 2019, 2020 and 2021208.6 16.3 46.8 
Remaining authorized amounts $221.4 $93.7 $63.2 
On April 29, 2022, the Utilities requested PUC approval to issue and sell each utility’s common stock over a four-year period from January 1, 2023 through December 31, 2026 (Hawaiian Electric’s sale/s to HEI of up to $75 million, Hawaii Electric Light sale/s to Hawaiian Electric of up to $25 million, and Maui Electric sale/s to Hawaiian Electric of up to $55 million) and the purchase of Hawaii Electric Light and Maui Electric common stock by Hawaiian Electric from 2023 through December 31, 2026.
Cash flows. The following table reflects the changes in cash flows for the three months ended March 31, 2022 compared to the three months ended March 31, 2021:
Three months ended March 31
(in thousands)20222021Change
Net cash provided by operating activities$76,775 $31,961 $44,814 
Net cash used in investing activities(74,864)(68,498)(6,366)
Net cash provided by (used in) financing activities(25,974)36,460 (62,434)

Net cash provided by operating activities. The increase in net cash provided by operating activities was driven by higher cash receipts from customers due to increased disconnection effort and receipts of payments on installment plans, and timing in receipts of payments from large government accounts, as well as lower cash paid for accounts payable due to timing, partially offset by higher cash paid for fuel oil stock due to higher fuel oil prices and volume purchased.
Net cash used in investing activities. The increase in net cash used in investing activities was primarily driven by an increase in capital expenditures related to construction activities.
Net cash provided by financing activities. The decrease in net cash provided by financing activities was primarily driven by lower net cash from long-term debts, partially offset by net increase in short-term borrowings.
Material cash requirements. Material cash requirements of the Utilities include O&M expenses, including labor and benefit costs, fuel and purchase power costs, repayment of debt and interest payments, operating lease obligations, its forecasted capital expenditures and investments, its expected retirement benefit plan contributions and other short-term and long-term material cash requirements. The cash requirements for O&M, fuel and purchase power costs, debt and interest payments, and operating lease obligations are generally funded through the collection of the Utilities’ revenue requirement established in the last rate case and other mechanisms established under the regulatory framework. The cash requirements for capital expenditures are generally funded through retained earnings, the issuance of debt, and contributions of equity from HEI and generally recovered through the Utilities’ revenue requirement or other capital recovery mechanisms over time. The Utilities believe that their ability to generate cash is adequate to maintain sufficient liquidity to fund their material cash requirements. However, the COVID-19 pandemic is an evolving situation, and the Utilities cannot predict the extent or duration of the outbreak, the future effects that it will have on the global, national or local economy, including the impacts on the Utilities’ ability, as well as the cost, to access additional capital, or the future impacts on the Utilities’ financial position, results of operations, and cash flows.
Forecast capital expenditures. For the five-year period 2022 through 2026, the Utilities forecast up to $2.1 billion of net capital expenditures, which could change over time based upon external factors such as the timing and scope of environmental regulations and/or unforeseen delays in permitting and timing of PUC decisions. Approximately $1.3 billion is related to replacement and modernization of generation, transmission and distribution assets; approximately $0.5 billion is related to climate-related projects to transition to renewable energy or mitigate climate impacts by increasing the resilience of the system, and approximately $0.3 billion for targeted efforts to improve reliability. Proceeds from the issuance of equity and long-term debt, cash flows from operating activities, temporary increases in short-term borrowings and existing cash and cash equivalents are expected to provide the funds needed for the net capital expenditures, to pay down commercial paper or other short-term borrowings, as well as to fund any unanticipated expenditures not included in the 2022 to 2026 forecast (such as increases in the costs or acceleration of capital projects, or unanticipated capital expenditures that may be required by new environmental laws and regulations).
69

Management periodically reviews capital expenditure estimates and the timing of construction projects. These estimates may change significantly as a result of many considerations, including changes in economic conditions, changes in forecasts of kWh sales and peak load, the availability of purchased power and changes in expectations concerning the construction and ownership of future generation units, the availability of generating sites and transmission and distribution corridors, the need for fuel infrastructure investments, the ability to obtain adequate and timely rate increases, escalation in construction costs, the effects of opposition to proposed construction projects and requirements of environmental and other regulatory and permitting authorities.
70

Bank
Recent Developments—COVID-19
See also Recent developments—COVID-19 in HEI’s MD&A.
The Hawaii economy continued to improve in the first quarter of 2022 as an increase in visitor arrivals have helped drive a growing labor market and tax collections. Domestic visitor arrivals were near pre-pandemic levels due to pent up demand from leisure travelers. The state and county governments have also lifted all COVID-related travel restrictions for arriving domestic passengers. International visitor arrivals continued to lag significantly behind pre-pandemic levels but it is expected to increase as Asian countries begin to loosen travel restrictions. Other COVID-related mandates have also been lifted such as the indoor mask mandate and capacity limits for indoor and outdoor events. Although new daily case counts have risen recently, hospitalization rates have not been impacted by the increase in infection counts.
The Federal Reserve raised its federal funds rate for the first time in three years in response to inflationary pressures in the economy. The overall level of interest rates across the curve remain at relatively low levels and ASB’s net interest margin for the quarter ended March 31, 2022 of 2.79% was flat to the linked quarter ended December 31, 2021 and lower than the net interest margin for the quarter ended March 31, 2021 of 2.95%.
ASB continued to experience deposit growth, which outpaced loan growth and was used to purchase investment securities. The Bank’s ASB CARES loan program continued to paydown and fees from the program along with the growth in investment securities portfolio contributed to higher interest income, offsetting the effect of lower loan portfolio balances and earning asset yields. Net interest income improved to $59.0 million for the quarter ended March 31, 2022 compared to $57.1 million for the quarter ended March 31, 2021.
For the quarter ended March 31, 2022, ASB recorded a $3.3 million negative provision for credit losses that reduced the allowance for credit losses, reflecting the release of reserves for a nonperforming loan that was paid down, lower loss rates in the commercial real estate loan portfolio and overall lower net charge offs. The provision for credit losses in future quarters will be dependent on future economic conditions and changes to borrower credit quality at that time.
In response to COVID-19, ASB made short-term loan modifications to borrowers who were generally payment current at the time of relief. As of March 31, 2022, approximately $0.1 million of loans remained in their active deferral period. Approximately $6.1 million of loans were not able to resume their contractual payments and were considered delinquent as of March 31, 2022.
In 2020, ASB temporarily closed 15 of its 49 branches and reduced banking hours at the branches that remained open in an effort to reduce social gathering and protect employees and customers. The bank has since reopened seven of the branches that were temporarily closed and permanently closed eight branches. Three of the reopened branches are now digital branches, which provides digital solutions such as full-service ATMs and access to expert bankers through videoconferencing tools while allowing ASB to have a more efficient physical footprint . The reduction in ASB’s branch network should not have a significant impact to the bank’s customers as there are other branches nearby and other channels such as online and mobile banking. ASB continues to evaluate its branch network to determine whether further changes may be appropriate given its customers’ use of other banking channels.
ASB’s senior management team continually addresses the impacts to the operations and business of the bank as a result of the pandemic and meets regularly with ASB’s board of directors to keep them apprised of the impacts of the COVID-19 pandemic.
The CARES Act was signed into law on March 27, 2020. The CARES Act provided over $2 trillion in economic assistance for American workers, families, and small businesses, and job preservation for American industries. The PPP was established under the CARES Act and implemented by the United States Small Business Administration (SBA) to provide a direct incentive for small businesses to keep their workers on the payroll as a result of the COVID-19 crisis. ASB worked with a number of small businesses, both customers and non-customers, to complete the loan application forms so that these businesses could participate in the program. During the first round of PPP, the Bank secured more than $370 million in PPP loans for approximately 4,100 small businesses that supported over 40,000 jobs; ASB received processing fees totaling approximately $13 million and started recognizing these fees over the life of the loans. During the second round of PPP, ASB secured more than $175 million for approximately 2,200 small businesses that supported more than 20,000 jobs; ASB received processing fees of approximately $9 million. The remaining PPP loans outstanding as of March 31, 2022 was approximately $41 million and the remaining fees to be recognized over the life of the loans was approximately $1.5 million.
Other provisions of the CARES Act provides that a financial institution may elect to suspend the requirements under GAAP for certain loan modifications that would otherwise be categorized as a TDR and any related impairment for accounting
71

purposes. See Note 4 of the Condensed Consolidated Financial Statements and “Economic conditions” in the “HEI Consolidated” section above.
ASB continues to maintain its low-risk profile, strong balance sheet and straightforward community banking business model.
 Three months ended March 31Increase 
(in millions)20222021(decrease)Primary reason(s)
Interest and dividend income$60 $59 $1 
Average loan portfolio yields were 19 basis points lower—impacted by the continued low interest rate environment as adjustable rate loans have repriced lower during the past year and new loan production yields continue to originate below their portfolio yields. Lower loan yields were also due to lower PPP loan fees recognized in 2022 compared to 2021 as the PPP loan portfolio has paid down significantly over the past year.
Average loan portfolio balances decreased $156 million - home equity lines of credit average balance decreased $97 million due to increased paydowns in the portfolio; consumer loan average balance decreased $45 million due to ASB’s strategic decision to reduce production of this loan type during the period of weakened economic activity caused by the COVID-19 pandemic. Commercial loan average balance decreased $201 million due to repayments in the PPP loan portfolio. Residential average balance increased $154 million due to the Bank’s decision to portfolio a larger portion of the production. Commercial real estate average balance increased $28 million due to demand for this loan type.
Average investment securities portfolio balance increased $801 million—excess liquidity from strong deposit growth invested in agency securities.
Average investment securities yields 30 basis points higher—benefited from lower amortization of premiums in the investment portfolio.
Noninterest income16 19 (3)
Lower mortgage banking income - lower residential loan sale volume due to lower production volume, ASB’s decision to portfolio a larger portion of the residential loan production and lower residential loan sale profit margin in 2022 compared to 2021.
Lower bank owned life insurance income - lower return from insurance policies and lower insurance policy claim proceeds in 2022 compared to 2021.
Gain on sale of real estate - due to the sale of a branch property owned by ASB. The branch was closed in January 2022.
Less: gain on sale of real estate(1)— (1)Gain on sale of real estate, which is included in Noninterest income above and in the Bank’s statements of income and comprehensive income in Note 4, is classified as gain on sale of real estate in the condensed consolidated statements of income, and accordingly, is reflected in operating expenses below as a separate line item and excluded from Revenues.
Less: gain on sale of investment securities, net— (1)1 Gain on sale of investment securities, net, which is included in Noninterest income above and in the Bank’s statements of income and comprehensive income in Note 4, is classified as gain on sale of investment securities, net in the condensed consolidated statements of income, and accordingly, is reflected below following operating income as a separate line item and excluded from Revenues.
Revenues75 77 (2)
The decrease in revenues for the three months ended March 31, 2022 compared to the same period in 2021 was primarily due to lower noninterest income partly offset by higher interest income.
Interest expense1 1 — 
Interest expense on deposits and other borrowings were flat.
Average core deposit balances increased $535 million; average term certificate balances decreased $129 million.
Average deposit yields decreased from 8 basis points to 5 basis points.
Average other borrowings decreased $15 million and average yields decreased 8 basis points.
Provision for credit losses(3)(8)5 
72

 Three months ended March 31Increase 
(in millions)20222021(decrease)Primary reason(s)
2022 negative provision for credit losses reflects a stable economic outlook, good credit trends including lower net charge-offs and improved credit loss rates which included credit upgrades in the commercial real estate loan portfolio.
2022 negative provision for credit losses also due to the release of loss reserves for a commercial real estate credit.
2021 negative provision for credit losses reflected improvement in economic outlook, strong credit results including lower net charge-offs and improved credit loss rates which included credit upgrades in the commercial real estate and commercial loan portfolios.
2021 negative provision for credit losses was also due to lower personal unsecured loan portfolio balances which had higher credit loss rates.
Delinquency rates have decreased—from 0.43% at March 31, 2021 to 0.27% at March 31, 2022 due to lower residential 1-4 family, commercial real estate, consumer and home equity line of credit loan delinquencies.
Net charge-off to average loans have decreased—from 0.18% at March 31, 2021 to 0.01% at March 31, 2022 primarily due to lower personal unsecured loan portfolio net charge-offs.
Noninterest expense48 48 — 
Lower compensation and benefits expenses offset by higher occupancy expenses.
2021 noninterest expense benefited from a one-time credit adjustment for a change in accounting for the ASB retirement plan.
Gain on sale of real estate(1)— (1)
Expenses45 41 4 
The increase in expenses for the three months ended March 31, 2022 compared to the same period in 2021 was due to higher negative provision for credit losses in 2021, partly offset by higher gain on sale of real estate.
Operating income30 36 (6)
The decrease in operating income for the three months ended March 31, 2022 compared to the same period in 2021 was primarily due to higher negative provision for credit losses in 2021 and lower noninterest income, partly offset by higher interest income.
Gain on sale of investment securities, net— 1 (1)The decrease in gain on sale of investment securities - primarily due to the sale of investment securities in 2021 with no similar sales in 2022.
Net income24 30 (6)
Net income for the three months ended March 31, 2022 was lower than the same period in 2021 due to lower operating income and lower gain on sale of investment securities, partly offset by lower income tax expense.

ASB’s return on average assets, return on average equity and net interest margin were as follows:
Three months ended March 31
(%)20222021
Return on average assets1.04 1.40 
Return on average equity13.70 16.04 
Net interest margin2.79 2.95 

73

Three months ended March 31
20222021
(dollars in thousands)Average
balance		Interest
income/
expense		Yield/
rate (%)		Average
balance
Interest
 income/
expense
Yield/
rate (%)
Assets:      
Interest-earning deposits$134,835 $66 0.20 $47,080 $12 0.10 
FHLB stock10,000 74 3.00 9,929 81 3.29 
Investment securities
Taxable3,131,482 13,554 1.73 2,352,570 8,366 1.42 
Non-taxable69,600 367 2.11 47,599 271 2.28 
Total investment securities3,201,082 13,921 1.74 2,400,169 8,637 1.44 
Loans   
Residential 1-4 family2,303,446 20,113 3.49 2,149,788 19,588 3.64 
Commercial real estate1,137,295 9,211 3.25 1,108,851 9,005 3.26 
Home equity line of credit840,974 6,223 3.00 937,942 7,265 3.14 
Residential land20,822 257 4.93 16,457 210 5.11 
Commercial761,525 6,812 3.60 962,198 8,912 3.73 
Consumer113,826 3,459 12.33 158,930 4,987 12.72 
Total loans 1,2
5,177,888 46,075 3.58 5,334,166 49,967 3.77 
Total interest-earning assets 3
8,523,805 60,136 2.83 7,791,344 58,697 3.03 
Allowance for credit losses(71,135)  (101,712)  
Noninterest-earning assets709,010   766,844   
Total assets$9,161,680   $8,456,476   
Liabilities and shareholder’s equity:      
Savings$3,258,551 $207 0.03 $2,901,661 $191 0.03 
Interest-bearing checking1,331,008 64 0.02 1,180,049 57 0.02 
Money market205,363 33 0.07 178,275 37 0.09 
Time certificates411,372 643 0.63 540,461 1,177 0.88 
Total interest-bearing deposits5,206,294 947 0.07 4,800,446 1,462 0.12 
Advances from Federal Home Loan Bank— — — 30,126 23 0.30 
Securities sold under agreements to repurchase and federal funds purchased90,279 5 0.02 75,332 4 0.02 
Total interest-bearing liabilities5,296,573 952 0.07 4,905,904 1,489 0.12 
Noninterest bearing liabilities:      
Deposits2,973,597   2,645,636   
Other194,449   168,067   
Shareholder’s equity697,061   736,869   
Total liabilities and shareholder’s equity$9,161,680   $8,456,476   
Net interest income $59,184   $57,208  
Net interest margin (%) 4
  2.79   2.95 
1   Includes loans held for sale, at lower of cost or fair value.
2   Includes recognition of net deferred loan fees of $1.9 million and $2.8 million for the three months ended March 31, 2022 and 2021, respectively, together with interest accrued prior to suspension of interest accrual on nonaccrual loans. Includes nonaccrual loans.
3   For the three months ended March 31, 2022 and 2021, the taxable-equivalent basis adjustments made to the table above were not material.
4   Defined as net interest income, on a fully taxable equivalent basis, as a percentage of average total interest-earning assets.
Earning assets, costing liabilities, contingencies and other factors.  Earnings of ASB depend primarily on net interest income, which is the difference between interest earned on earning assets and interest paid on costing liabilities. The interest rate environment has been impacted by disruptions in the financial markets over a period of several years. Although the Federal Open Market Committee increased its federal funds rate target range to 0.25% - 0.50% in 2022 due to signs of inflation, ASB’s
74

net interest income and net interest margin remain at lower levels. A prolonged low interest rate environment may continue to negatively impact ASB’s net interest income and net interest margin.
Loans and mortgage-backed securities are ASB’s primary earning assets.
Loan portfolio.  ASB’s loan volumes and yields are affected by market interest rates, competition, demand for financing, availability of funds and management’s responses to these factors. See Note 4 of the Condensed Consolidated Financial Statements for a composition of ASB’s loan portfolio.
Home equity — key credit statistics. The HELOC portfolio makes up 16% of the total loan portfolio and is generally an interest-only revolving loan for a 10-year period, after which time the HELOC outstanding balance converts to a fully amortizing variable-rate term loan with a 20-year amortization period. Borrowers also have a “Fixed Rate Loan Option” to convert a part of their available line of credit into a 5, 7 or 10-year fully amortizing fixed-rate loan with level principal and interest payments. As of March 31, 2022, approximately 38% of the portfolio balances were amortizing loans under the Fixed Rate Loan Option. A HELOC loan is typically in a subordinate lien position to a borrower’s first mortgage loan, however, approximately 57% of ASB’s HELOC loan portfolio is in a first lien position.
Loan portfolio risk elements.  See Note 4 of the Condensed Consolidated Financial Statements.
Investment securities.  ASB’s investment portfolio was comprised as follows:
 March 31, 2022December 31, 2021
(dollars in thousands)Balance% of totalBalance% of total
U.S. Treasury and federal agency obligations$166,079 5 %$149,961 5 %
Mortgage-backed securities — issued or guaranteed by U.S. Government agencies or sponsored agencies2,914,027 93 2,900,322 94 
Corporate bonds43,123 1 31,178 1 
Mortgage revenue bonds15,296 1 15,427 — 
Total investment securities$3,138,525 100 %$3,096,888 100 %
Currently, ASB’s investment portfolio consists of U.S. Treasury and federal agency obligations, mortgage-backed securities, corporate bonds and mortgage revenue bonds. ASB owns mortgage-backed securities issued or guaranteed by the U.S. government agencies or sponsored agencies, including the Federal National Mortgage Association (FNMA), Federal Home Loan Mortgage Corporation (FHLMC), Government National Mortgage Association (GNMA) and Small Business Administration (SBA). Principal and interest on mortgage-backed securities issued by FNMA, FHLMC, GNMA and SBA are guaranteed by the issuer and, in the case of GNMA and SBA, backed by the full faith and credit of the U.S. government. U.S. Treasury securities are also backed by the full faith of the U.S. government. The increase in the investment securities portfolio was primarily due to the purchase of treasury and agency mortgage-backed securities with excess liquidity.
Deposits and other borrowings.  Deposits continue to be the largest source of funds for ASB and are affected by market interest rates, competition and management’s responses to these factors. While deposits have increased by $117 million year-to-date, deposit retention and sustained growth will remain challenging in the current environment due to the low level of short-term interest rates. Advances from the FHLB of Des Moines, securities sold under agreements to repurchase and federal funds purchased continue to be additional sources of funds. As of March 31, 2022 ASB’s costing liabilities consisted of 98% deposits and 2% other borrowings compared to 99% deposits and 1% other borrowings as of December 31, 2021. The weighted average cost of deposits for the first three months of 2022 and 2021 was 0.05% and 0.08%, respectively.
Federal Home Loan Bank of Des Moines. As of March 31, 2022 and December 31, 2021, ASB had no advances outstanding at the FHLB of Des Moines. As of March 31, 2022, the unused borrowing capacity with the FHLB of Des Moines was $2.1 billion. The FHLB of Des Moines continues to be an important source of liquidity for ASB.
Contingencies.  ASB is subject in the normal course of business to pending and threatened legal proceedings. Management does not anticipate that the aggregate ultimate liability arising out of these pending or threatened legal proceedings will be material to its financial position. However, ASB cannot rule out the possibility that such outcomes could have a material adverse effect on the results of operations or liquidity for a particular reporting period in the future.
Other factors.  Interest rate risk is a significant risk of ASB’s operations and also represents a market risk factor affecting the fair value of ASB’s investment securities. Increases and decreases in prevailing interest rates generally translate into decreases and increases in the fair value of the investment securities, respectively. In addition, changes in credit spreads also impact the fair values of the investment securities.
75

As of March 31, 2022, ASB had an unrealized loss, net of taxes, on available-for-sale investment securities (including securities pledged for repurchase agreements) in AOCI of $152.4 million compared to an unrealized loss, net of taxes, of $32.0 million as of December 31, 2021. See “Item 3. Quantitative and qualitative disclosures about market risk” for a discussion of ASB’s interest rate risk sensitivity.
During the first three months of 2022, ASB recorded a negative provision for credit losses of $3.8 million in the allowance for credit losses reflecting a stable economic outlook, good credit trends including lower net charge-offs and credit upgrades in the commercial real estate loan portfolio and the release of reserves for a nonperforming commercial real estate loan. During the first three months of 2021, ASB recorded a negative provision for credit losses of $7.0 million in the allowance for credit losses primarily due to improvement in the economic outlook, strong credit results including lower net charge-offs and credit upgrades in the commercial real estate and commercial loan portfolios and lower personal unsecured loan portfolio balances.
 Three months ended March 31
Year ended
December 31, 2021
(in thousands)20222021
Allowance for credit losses, beginning of period$71,130 $101,201 $101,201 
Provision for credit losses(3,763)(7,035)(26,425)
Less: net charge-offs156 2,373 3,646 
Allowance for credit losses, end of period$67,211 $91,793 $71,130 
Ratio of net charge-offs during the period to average loans outstanding (annualized)0.01 %0.18 %0.07 %
ASB maintains a reserve for credit losses that consists of two components, the allowance for credit losses and an allowance for loan commitments (unfunded reserve). The level of the reserve for unfunded loan commitments is adjusted by recording an expense or recovery in provision for credit losses. For the three months ended March 31, 2022 and 2021, ASB recorded a provision for credit losses for unfunded commitments of $0.5 million and a negative provision for credit losses for unfunded commitments of $1.4 million, respectively. As of March 31, 2022 and December 31, 2021, the reserve for unfunded loan commitments was $5.4 million and $2.9 million, respectively.
Legislation and regulation.  ASB is subject to extensive regulation, principally by the OCC and the FDIC. Depending on ASB’s level of regulatory capital and other considerations, these regulations could restrict the ability of ASB to compete with other institutions and to pay dividends to its shareholder. See the discussion below under “Liquidity and capital resources.”
Changes to Community Bank Leverage Ratio. In April 2020, the federal bank regulatory agencies issued two interim final rules to implement Section 4012 of the CARES Act, which requires the agencies to temporarily lower the community bank leverage ratio to 8 percent. The two rules modify the community bank leverage ratio framework so that:
•Beginning in the second quarter of 2020 and until the end of the year, a banking organization that has a leverage ratio of 8 percent or greater and meets certain other criteria may elect to use the community bank leverage ratio framework; and
•Community banking organizations had until January 1, 2022 before the community bank leverage ratio requirement is re-established at greater than 9 percent.
Under the interim final rules, the community bank leverage ratio was 8 percent beginning in the second quarter of 2020 and for the remainder of calendar year 2020, 8.5 percent for calendar year 2021, and 9 percent thereafter. The interim final rules also maintain a two-quarter grace period for a qualifying community banking organization whose leverage ratio falls no more than 1 percent below the applicable community bank leverage ratio.
Beginning in the second quarter of 2020, ASB adopted the community bank leverage ratio framework, which allowed it to report only on the community bank leverage ratio, but does not change minimum capital requirements under OCC regulations. At March 31, 2021, ASB’s leverage ratio was below the 8.5 percent requirement to qualify for abbreviated reporting under the community bank leverage framework for 2021 and started reporting its risk-based capital ratios in the third quarter of 2021. As of March 31, 2022, the bank was in compliance with all of the minimum capital requirements under OCC regulations, and was categorized as “well capitalized” under the regulatory framework for prompt corrective action.
76

FINANCIAL CONDITION
Liquidity and capital resources.
(dollars in millions)March 31, 2022December 31, 2021% change
Total assets$9,252 $9,182 1 
Investment securities3,139 3,097 1 
Loans held for investment, net5,118 5,140 — 
Deposit liabilities8,289 8,172 1 
Other bank borrowings137 88 56 
As of March 31, 2022, ASB was one of Hawaii’s largest financial institutions based on assets of $9.3 billion and deposits of $8.3 billion.
As of March 31, 2022, ASB’s unused FHLB borrowing capacity was approximately $2.1 billion. As of March 31, 2022, ASB had commitments to borrowers for loans and unused lines and letters of credit of $2.0 billion, of which, commitments to lend to borrowers whose loan terms have been modified in troubled debt restructurings were nil. Management believes ASB’s current sources of funds will enable it to meet these obligations while maintaining liquidity at satisfactory levels.
For the three months ended March 31, 2022, net cash provided by ASB’s operating activities was $24 million. Net cash used during the same period by ASB’s investing activities was $152 million, primarily due to purchases of available-for-sale securities of $291 million and additions to premises and equipment of $1 million, partly offset by the receipt of investment security repayments and maturities of $109 million, a net decrease in loans of $28 million, proceeds from redemption of bank owned life insurance of $2 million and proceeds from the sale of real estate of $1 million. Net cash provided by financing activities during this period was $147 million, primarily due to increases in deposit liabilities of $117 million and a net increase in repurchase agreements of $49 million, partly offset by a net decrease in mortgage escrow deposits of $4 million and $15 million in common stock dividends to HEI (through ASB Hawaii).
For the three months ended March 31, 2021, net cash provided by ASB’s operating activities was $17 million. Net cash used during the same period by ASB’s investing activities was $448 million, primarily due to purchases of available-for-sale securities of $782 million, purchases of held-to-maturity securities of $88 million, additions to premises and equipment of $3 million, contributions to low income housing investments of $3 million and a net increase in stock from the Federal Home Loan Bank of $1 million, partly offset by the receipt of investment security repayments and maturities of $205 million, proceeds from the sale of investment securities of $197 million, a net decrease in loans receivable of $24 million and proceeds from the redemption of bank owned life insurance of $3 million. Net cash provided by financing activities during this period was $362 million, primarily due to increases in deposit liabilities of $358 million and a net increase in repurchase agreements of $13 million, partly offset by a net decrease in mortgage escrow deposits of $4 million and $5 million in common stock dividends to HEI (through ASB Hawaii).
ASB believes that maintaining a satisfactory regulatory capital position provides a basis for public confidence, affords protection to depositors, helps to ensure continued access to capital markets on favorable terms and provides a foundation for growth. FDIC regulations restrict the ability of financial institutions that are not well-capitalized to compete on the same terms as well-capitalized institutions, such as by offering interest rates on deposits that are significantly higher than the rates offered by competing institutions. As of March 31, 2022, ASB was well-capitalized (well-capitalized ratio requirements noted in parentheses) with a Tier-1 leverage ratio of 7.8% (5.0%), common equity Tier-1 ratio of 13.3% (6.5%), Tier-1 capital ratio of 13.3% (8.0%) and total capital ratio of 14.3% (10.0%). As of December 31, 2021, ASB was well-capitalized (well-capitalized ratio requirements noted in parentheses) with a Tier-1 leverage ratio of 7.9% (5.0%), common equity Tier-1 ratio of 13.3% (6.5%), Tier-1 capital ratio of 13.3% (8.0%) and total capital ratio of 14.3% (10.0%). All dividends are subject to review by the OCC and FRB and receipt of a letter from the FRB communicating the agencies’ non-objection to the payment of any dividend ASB proposes to declare and pay to HEI (through ASB Hawaii).
Item 3. Quantitative and Qualitative Disclosures About Market Risk
The Company considers interest-rate risk (a non-trading market risk) to be a significant market risk for ASB as it could potentially have material impacts on the Company’s results of operations, financial condition and liquidity. For additional quantitative and qualitative information about the Company’s market risks, see HEI’s and Hawaiian Electric’s Quantitative and Qualitative Disclosures About Market Risk in Part II, Item 7A of HEI’s 2021 Form 10-K (pages 77 to 79).
77

ASB’s interest-rate risk sensitivity measures as of March 31, 2022 and December 31, 2021 constitute “forward-looking statements” and were as follows:
Change in interest ratesChange in NII
(gradual change in interest rates)		Change in EVE
(instantaneous change in interest rates)
(basis points)March 31, 2022December 31, 2021March 31, 2022December 31, 2021
+3003.6 %5.6 %10.3 %15.5 %
+2002.4 4.0 7.6 11.7 
+1001.2 2.3 4.2 7.0 
-100(1.5)(2.5)(6.0)(12.6)

ASB’s net interest income (NII) sensitivity profile was less asset sensitive as of March 31, 2022 compared to December 31, 2021, primarily driven by the increase in market rates and core deposit funded investment securities purchases. The increase in market rates decreased prepayment expectations in the bank’s fixed-rate mortgage and mortgage-backed investment portfolios, driving decreased asset sensitivity. In addition, the deployment of strong core deposit growth into new fixed-rate investment purchases further contributed to decreased sensitivity.
Economic value of equity (EVE) sensitivity decreased as of March 31, 2022 compared to December 31, 2021 as the duration of assets lengthened while the duration of core deposits shortened. The increase in market rates led to slower prepayment expectations and lengthened the duration of the fixed-rate mortgage and mortgage-backed investment portfolios. The upward shift in the yield curve shortened the duration of core deposits, further contributing to decreased EVE sensitivity.
The computation of the prospective effects of hypothetical interest rate changes on the NII sensitivity and the percentage change in EVE is based on numerous assumptions, including relative levels of market interest rates, loan prepayments, balance changes and pricing strategies, and should not be relied upon as indications of actual results. To the extent market conditions and other factors vary from the assumptions used in the simulation analysis, actual results may differ materially from the simulation results. NII sensitivity analysis measures the change in ASB’s twelve-month, pretax NII in alternate interest rate scenarios, and is intended to help management identify potential exposures in ASB’s current balance sheet and formulate appropriate strategies for managing interest rate risk. The simulation does not contemplate any actions that ASB management might undertake in response to changes in interest rates. Further, the changes in NII vary in the twelve-month simulation period and are not necessarily evenly distributed over the period. These analyses are for analytical purposes only and do not represent management’s views of future market movements, the level of future earnings or the timing of any changes in earnings within the twelve month analysis horizon. The actual impact of changes in interest rates on NII will depend on the magnitude and speed with which rates change, actual changes in ASB’s balance sheet and management’s responses to the changes in interest rates.
78

Item 4. Controls and Procedures
HEI:
Disclosure Controls and Procedures
The Company maintains a set of disclosure controls and procedures designed to provide reasonable assurance that information required to be disclosed by the Company in reports that it files or submits under the Securities Exchange Act of 1934, as amended (Exchange Act), is recorded, processed, summarized and reported within the time periods specified in SEC’s rules and forms, and that such information is accumulated and communicated to the Company’s management, including its Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.
An evaluation was performed under the supervision and with the participation of the Company’s management, including the Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures, as defined in Rule 13a-15(e) or Rule 15d-15(e) of the Exchange Act. Management, including the Company’s Chief Executive Officer and Chief Financial Officer, concluded that the Company’s disclosure controls and procedures were effective, as of the end of the period covered by this report, at the reasonable assurance level.
Changes in Internal Control Over Financial Reporting
There have been no changes in internal control over financial reporting during the first quarter of 2022 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.
Hawaiian Electric:
Disclosure Controls and Procedures
Hawaiian Electric maintains a set of disclosure controls and procedures designed to provide reasonable assurance that information required to be disclosed by Hawaiian Electric in reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in SEC’s rules and forms, and that such information is accumulated and communicated to Hawaiian Electric’s management, including its Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.
An evaluation was performed under the supervision and with the participation of Hawaiian Electric’s management, including the Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of Hawaiian Electric’s disclosure controls and procedures, as defined in Rule 13a-15(e) or Rule 15d-15(e) of the Exchange Act. Management, including Hawaiian Electric’s Chief Executive Officer and Chief Financial Officer, concluded that Hawaiian Electric’s disclosure controls and procedures were effective, as of the end of the period covered by this report, at the reasonable assurance level.
Changes in Internal Control Over Financial Reporting
There have been no changes in internal control over financial reporting during the first quarter of 2022 that have materially affected, or are reasonably likely to materially affect, Hawaiian Electric’s internal control over financial reporting.
79


PART II - OTHER INFORMATION

Item 1. Legal Proceedings
The descriptions of legal proceedings (including judicial proceedings and proceedings before the PUC and environmental and other administrative agencies) in HEI’s and Hawaiian Electric’s 2021 Form 10-K (see “Part I. Item 3. Legal Proceedings” and proceedings referred to therein) and this Form 10-Q (see “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and Notes 3 and 4 of the Condensed Consolidated Financial Statements) are incorporated by reference in this Item 1. With regard to any pending legal proceeding, alternative dispute resolution, such as mediation or settlement, may be pursued where appropriate, with such efforts typically maintained in confidence unless and until a resolution is achieved. Certain HEI subsidiaries (including Hawaiian Electric and its subsidiaries, ASB and Pacific Current and its subsidiaries) may also be involved in ordinary routine PUC proceedings, environmental proceedings and litigation incidental to their respective businesses.
Item 1A. Risk Factors
For information about Risk Factors, see pages 20 to 34 of HEI’s and Hawaiian Electric’s 2021 Form 10-K and “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Quantitative and Qualitative Disclosures about Market Risk” and the Condensed Consolidated Financial Statements herein. Also, see “Cautionary Note Regarding Forward-Looking Statements” on pages iv through vi herein.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
(c) Purchases of HEI common shares were made on the open market during the first quarter of 2022 to satisfy the requirements of certain plans as follows:
ISSUER PURCHASES OF EQUITY SECURITIES
Period*
Total Number of Shares Purchased **		 
Average
Price Paid
per Share **
 Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs
Maximum Number (or Approximate Dollar Value) of Shares that May Yet Be Purchased Under the Plans or Programs
January 1 to 31, 202212,306$41.90—NA
February 1 to 28, 202214,171$41.35—NA
March 1 to 31, 2022177,272$42.12—NA
NA Not applicable.
* Trades (total number of shares purchased) are reflected in the month in which the order is placed.
**The purchases were made to satisfy the requirements of the DRIP, the HEIRSP and the ASB 401(k) Plan for shares purchased for cash or by the reinvestment of dividends by participants under those plans and none of the purchases were made under publicly announced repurchase plans or programs. Average prices per share are calculated exclusive of any commissions payable to the brokers making the purchases for the DRIP, the HEIRSP and the ASB 401(k) Plan. Of the “Total number of shares purchased,” 7,373 of the 12,306 shares, 8,597 of the 14,171 shares and 150,302 of the 177,272 shares were purchased for the DRIP; 3,644 of the 12,306 shares, 3,958 of the 14,171 shares and 20,995 of the 177,272 shares were purchased for the HEIRSP; and the remainder was purchased for the ASB 401(k) Plan. The repurchased shares were issued for the accounts of the participants under registration statements registering the shares issued under these plans.

80

Item 6. Exhibits
 
Agreement to provide the SEC with instruments which define the rights of holders of certain long-term debt of HEI and its subsidiaries.
Regulatory Capital Maintenance/Dividend Agreement dated May 26, 1988, between HEI, HEIDI and the Federal Savings and Loan Insurance Corporation (by the Federal Home Loan Bank of Seattle).
OTS letter regarding release from Part II.B. of the Regulatory Capital Maintenance/Dividend Agreement dated May 26, 1988.
Nonemployee Director Retirement Plan, effective as of October 1, 1989.
Certification Pursuant to Rule 13a-14 promulgated under the Securities Exchange Act of 1934 of Scott W. H. Seu (HEI Chief Executive Officer)
Certification Pursuant to Rule 13a-14 promulgated under the Securities Exchange Act of 1934 of Gregory C. Hazelton (HEI Chief Financial Officer)
HEI Certification Pursuant to 18 U.S.C. Section 1350
HEI Exhibit 101.INSXBRL Instance Document - the instance document does not appear on the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document
HEI Exhibit 101.SCHInline XBRL Taxonomy Extension Schema Document
HEI Exhibit 101.CALInline XBRL Taxonomy Extension Calculation Linkbase Document
HEI Exhibit 101.DEFInline XBRL Taxonomy Extension Definition Linkbase Document
HEI Exhibit 101.LABInline XBRL Taxonomy Extension Label Linkbase Document
HEI Exhibit 101.PREInline XBRL Taxonomy Extension Presentation Linkbase Document
HEI Exhibit 104Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)
Supply Contract for Low Sulfur Fuel Oil, High Sulfur Fuel Oil, No. 2 Diesel, and Ultra-Low Sulfur Diesel by and between Hawaiian Electric, Hawaii Electric Light, and Maui Electric and PAR Hawaii Refining, LLC dated February 1, 2022 (certain confidential information has been omitted)
Second Amendment dated February 1, 2022 to Supply Contract for Low Sulfur Fuel Oil, High Sulfur Fuel Oil, No. 2 Diesel, and Ultra-Low Sulfur Diesel by and between Hawaiian Electric, Hawaii Electric Light, and Maui Electric and PAR Hawaii Refining, LLC dated January 21, 2019 (certain confidential information has been omitted)
Certification Pursuant to Rule 13a-14 promulgated under the Securities Exchange Act of 1934 of Shelee M. T. Kimura (Hawaiian Electric Chief Executive Officer)
Certification Pursuant to Rule 13a-14 promulgated under the Securities Exchange Act of 1934 of Tayne S. Y. Sekimura (Hawaiian Electric Chief Financial Officer)
Hawaiian Electric Certification Pursuant to 18 U.S.C. Section 1350

* Exhibit was previously filed with the SEC prior to 1994.
81

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)
   
   
By/s/ Scott W. H. Seu By/s/ Shelee M. T. Kimura
 Scott W. H. Seu  Shelee M. T. Kimura
 President and Chief Executive Officer  President and Chief Executive Officer
 (Principal Executive Officer of HEI)  (Principal Executive Officer of Hawaiian Electric)
   
   
By/s/ Gregory C. Hazelton By/s/ Tayne S. Y. Sekimura
 Gregory C. Hazelton  Tayne S. Y. Sekimura
 Executive Vice President  Senior Vice President,
 and Chief Financial Officer  Chief Financial Officer and Treasurer
 (Principal Financial Officer of HEI)  (Principal Financial Officer of Hawaiian Electric)
   
   
Date: May 9, 2022 Date: May 9, 2022

82



HEI Exhibit 4.1



HEI agrees to furnish to the Securities and Exchange Commission, upon request, copies of the instruments which define the rights of holders of long-term debt of HEI and its subsidiaries. HEI reserves the right to request confidential treatment of such copies.




Hawaiian Electric Exhibit 10.1

CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) IS THE TYPE OF INFORMATION THAT HAWAIIAN ELECTRIC COMPANY, INC. TREATS AS PRIVATE OR CONFIDENTIAL.


SUPPLY AGREEMENT FOR PETROLEUM FUELS



This Supply Agreement for Low Sulfur Fuel Oil (“LSFO”), High Sulfur Fuel Oil (“HSFO”), No. 2 Diesel (“Diesel”), and Ultra-Low Sulfur Diesel (“ULSD”) (“Agreement”) is made this 1st day of February, 2022 (“Execution Date”), by and between Hawaiian Electric Company, Inc. (“Hawaiian Electric”), a Hawai‘i corporation, Hawaiʻi Electric Light Company, Inc. (“Hawai‘i Electric Light”), a Hawaiʻi corporation, and Maui Electric Company, Limited (“Maui Electric”), a Hawaiʻi corporation, (each, a “Company” and collectively, the “Companies”) and Par Hawaii Refining, LLC, a Hawaiʻi limited liability corporation (“Seller”), with its principal place of business and mailing address at 91-325 Komohana St, Kapolei, HI 96707. The Companies and Seller are each a party (“Party”) and collectively the parties (“Parties”) to this Agreement.

WHEREAS, the Companies are in the business of generation, transmission, and distribution of electrical power on the islands of O‘ahu, Hawai‘i, Maui, Moloka‘i, and Lāna‘i, each in the State of Hawai‘i and subject to the Hawai‘i Public Utilities Law (Hawai‘i Revised Statutes, Chapter 269) and the rules and regulations of the Public Utilities Commission of the State of Hawai‘i (“Commission”); and

WHEREAS, the Companies desire LSFO, HSFO, Diesel, and ULSD (collectively, “Product”) in quantities that meet the Companies’ requirements; and

WHEREAS, Seller represents that it is equipped and has the ability to supply and deliver the Product to the Companies that is sufficient to meet the Companies’ requirements; and

WHEREAS, Seller desires, has the capability, and is willing to supply and deliver the Product to the Companies and the Companies are willing to purchase and receive the Product from Seller under the terms and conditions set forth hereinafter.

NOW, THEREFORE, it is mutually agreed by the Parties hereto as follows:

ARTICLE I
DEFINITIONS

Except where otherwise indicated, the following definitions shall apply throughout this Agreement.

1.1    “Affiliate”, except where otherwise expressly provided, means a corporation controlling, controlled by or under common control with Seller or the Companies, as the case may be.
1.2    “Agreement” means this Supply Agreement for Petroleum Fuel between the Companies and Seller.
1.3    “API” means American Petroleum Institute.







1.4    “Appeal Period” has the meaning set forth in Section 2.2(B) (Non-appealable Commission Approval Order).
1.5    “ASC” has the meaning set forth in Section 17.10(A) (Financial Compliance; No Consolidation).
1.6    “ASTM” means the American Society for Testing and Materials.
1.7    “Barge Composite” has the meaning set forth in Section 6.10(B)(3).
1.8    “Barrel” means 42 American bulk gallons at 60 DF.
1.9    “BPTF” means Hawaiian Electric’s Barbers Point Tank Farm, a fuel receiving, storage and distribution facility located at the Campbell Estate Industrial Park, O‘ahu, Hawai‘i.
1.10    “BTU” and “BTU content” means British Thermal Unit and refers to the standard assessment of fuel’s gross heating value or gross heat content.
1.11    “Business Day” means any calendar day that is not a Saturday, a Sunday, or a federal or Hawai‘i state holiday.
1.12    “Cargo Letter” has the meaning set forth in Section 6.7(B).
1.13    “Certificate of Quality” or “Quality Certificate” means the formal document recording the Seller’s laboratory determination of quality of a particular sample which represents a specific Delivery, said laboratory determinations having been performed in accordance with the test methods specified in Article IV (Quality).
1.14    “Commission” means the Public Utilities Commission of the State of Hawaiʻi.
1.15    “Consumer Advocate” means the Division of Consumer Advocacy of the Department of Commerce and Consumers Affairs of the State of Hawai‘i. “Confidential Information” has the meaning set forth in Section 17.9(A) (Confidential Information).
1.16    “Cover Costs” has the meaning set forth in Section 15.1(B) [...].
1.17    “Cover Supplies” has the meaning set forth in Section 15.1(B) [...].
1.18    “Day” or “Days” means a calendar day or calendar days.
1.19    “"DC” means degrees Celsius.
1.20    “Default” has the meaning set for in Section 15.1(A) (Default by Party).
1.21    “Deficiency” means the amount of LSFO Seller made available to Hawaiian Electric [...] as provided in Section 6.4(A) (Failure to Supply LSFO Position).
1.22    “Defaulting Party” has the meaning set forth in Section 15.1(A) (Default by a Party).
1.23    “Deliver”, “Delivery”, “Deliveries”, or “Delivered” means the transfer of title or physical movement of the Product by Seller as purchased by the Companies.
1.24    “Delivery Schedule” has the meaning set forth in Section 6.2(A) (Delivery Schedule).
1.25    “DF” means degrees Fahrenheit.
1.26    “Diesel” means No. 2 diesel produced in conformity with the provisions of the quality specified in this Agreement.“Diesel and HSFO Volume Forecast” has the meaning set forth in Section 6.7(A).
1.27    “DOT” means the Department of Transportation of the State of Hawai‘i.
1.28    “Disclosing Party” has the meaning set forth in Section 17.9(A) (Confidential Information).
1.29    “Effective Date” has the meaning set forth in Section 2.3 (Effective Date).
1.30    “Email” has the meaning set forth in Section 6.1 (Notice of LSFO).


1




1.31    “Energy Cost Recovery Clause” means the Energy Cost Recovery tariff applicable to Hawaiian Electric, Maui Electric, and Hawai‘i Electric Light, respectively.
1.32    “ETA” means estimated time of arrival.
1.33    “Extension” means any term of this Agreement in addition to and after the Initial Term, each of which is a consecutive 12-month period.
1.34    “Failure to Supply Position” or “FTSP” has the meaning set forth in Section 6.4 (A) (Failure to Supply LSFO Position).
1.35    “Force Majeure” has the meaning set forth in Section 11.1(A).
1.36    “FTSP Supply Plan” has the meaning set forth in Section 6.4(B) [...].
1.37    “Gallon” means a United States liquid gallon of 231 cubic inches.
1.38    “Government Approvals” means all permits, licenses, approvals, certificates, entitlements, and other authorizations issued by Governmental Authorities, as well as any agreements with Governmental Authorities, required to fulfill a Party’s obligations under this Agreement.
1.39    “Governmental Authority” means any federal, state, local or municipal governmental body or other authority exercising judicial, legislative, policy, regulatory, or taxing authority or power; or any court or governmental tribunal.
1.40    “G.S.V.” means gross standard volume in U.S. Barrels at 60 DF.
1.41    “Hawaiian Electric’s Facility” means the facilities designated for receipt of Product at BPTF, Campbell Industrial Park, O‘ahu, Hawai‘i.
1.42    “HEI” means Hawaiian Electric Industries, Inc.
1.43    “HSE Data” has the meaning set forth in Section 12.2 (Material Safety Compliance).
1.44    “HSFO” means high sulfur fuel oil produced in conformity with the provisions of the quality specified in this Agreement.
1.45    “Independent Determination” means a determination made by an independent laboratory as to an aspect of the Product.
1.46    “Independent Inspector” means a qualified third-party petroleum inspection contractor acceptable to both Parties providing petroleum sampling, measurement, and other relevant services before, during, and after a Delivery.
1.47    “Information” has the meaning set forth in Section 17.10(A) (Financial Compliance; No Consolidation).
1.48    “Initial Term” has the meaning set forth in Section 2.1 (Term).
1.49    “Law” or “Laws” means all present and future federal, state, and local laws, rules, regulations, orders, ordinances, permit conditions, and other actions of governmental or quasi-governmental authorities.
1.50    “LSFO” means low sulfur fuel oil produced in conformity with the provisions of the quality specified in this Agreement.
1.51    “LSFO Nomination” has the meaning set forth in Section 6.1(B) (LSFO Nomination).
1.52    “Month” means a calendar month.
1.53    “Nominated” and “Nomination” means the amount of the Product specified by the Companies and Delivered by Seller to the Companies for a specified Month.
1.54    “Non-appealable Commission Approval Order” has the meaning set forth in Section 2.2(B) (Non-appealable Commission Approval Order).


2




1.55    “Non-Defaulting Party” has the meaning set forth in Section 15.1(A) (Default by a Party).
1.56    “Offsetting Party” has the meaning set forth in Section 17.14 (Offsets)
1.57    “Party” and “Parties” have the meanings set forth in the preamble first paragraph of this Agreement.
1.58    “Person” means an individual, partnership, corporation, limited liability company, business trust, joint stock company, trust, unincorporated association, joint venture, Governmental Authority, or other entity.
1.59    “Person in Charge” or “PIC” means an individual designated as a person in charge of transfer operations under 33 CRF § 154.710 (for facilities) or CFR § 155.700 (for vessels).
1.60    “Pipeline Blend” means a mixture of Seller’s Pipeline Fill and the Product.
1.61    “Pipeline Delivery” or “Pipeline Deliveries” means a Delivery of the Product and/or the components thereof, including blend stock, all, or part of which are Delivered by Seller to Hawaiian Electric’s receiving and storage tanks at BPTF.
1.62    “Pipeline Fill” means the petroleum fuel residing in the pipelines through which Seller makes Delivery of the Product to the Companies.
1.63    “Proceeding” has the meaning set forth in Section 7.2(D) (No Litigation).
1.64    “Product” means LSFO, HSFO, Diesel, and/or ULSD as defined herein suitable for use as a fuel of the quality specifications described in Article IV (Quality).
1.65    [...] has the meaning set forth in [...].
1.66    “Ratable” means a volume that is proportional and able to be rated or estimated.
1.67    “Representatives” means the officers, directors, members, managers, employees, or agents of a Party or its Affiliates.
1.68    “Reverse Line Displacement” means an operation where Hawaiian Electric pumps Hawaiian Electric’s fuel into the pipeline that Seller uses to Deliver the Product to Hawaiian Electric in order to displace Seller’s Pipeline Fill.
1.69    “Specifications” means the fuel quality specifications applicable to the Product as described herein.
1.70    [...] has the meaning set forth in [...].
1.71    [...] has the meaning set forth in [...].
1.72    “SPM” has the meaning set forth in Section 3.2(A)(4) (Use of Logistics Facilities).
1.73    “Tank Composite” has the meaning set forth in Section 6.10(B)(2).
1.74    “Tank Final Sample” has the meaning set forth in Section 6.5(D) (Determination of Quality).
1.75    [...] has the meaning set forth in [...].
1.76    [...] has the meaning set forth in [...].
1.77    “ULSD” means ultra-low sulfur diesel produced in conformity with the provisions of the quality specified in this Agreement.
1.78    “Unfavorable Commission Approval Order” has the meaning set forth in Section 2.2(E) (Unfavorable Commission Order).
1.79    “USD” means currency denominated in U.S. dollars.
1.80    “Year” means a calendar year.


3




ARTICLE II
TERM

Section 2.1:    Term. The term of this Agreement (“Initial Term”) shall be from the Effective Date through and including January 31, 2026, unless terminated earlier as provided in this Agreement. This Agreement shall continue thereafter on a successive year-to-year basis (each such year being an “Extension”) beginning on February 1, 2026, unless the Companies or Seller gives written notice to the other of termination at least one hundred twenty (120) Days before the beginning of an Extension.

Section 2.2:    Regulatory Approval.
(A)    Commission Approval Order. The Parties acknowledge and agree that this Agreement is subject to approval by the Commission and the Parties’ respective obligations hereunder are conditioned upon receipt of such approval, except as specifically provided otherwise herein. Upon execution of this Agreement, the Parties shall use good faith efforts to obtain, as soon as practicable, an order from the Commission (“Commission Approval Order”). Notwithstanding the foregoing, the Companies acknowledge that Seller shall not be a party to any proceeding with the Commission concerning this Agreement, but shall provide reasonable assistance to the Companies in connection therewith. The Commission Approval Order regarding this Agreement shall not contain terms and conditions deemed to be unacceptable to the Parties, and is in a form deemed to be reasonable by the Parties, ordering that (i) this Agreement is approved; (ii) the Purchased cost of the Product to be incurred by the Companies as a result of this Agreement is reasonable; (iii) the Companies’ purchase of the Product pursuant to this Agreement is prudent and in the public interest; (iv) the Companies may include the Product purchased costs incurred by the Companies pursuant to this Agreement in the Companies’ revenue requirements for ratemaking purposes and for the purposes of determining the reasonableness of the Companies’ rates and/or for cost recovery above those fuel costs included in the base rate through the Companies’ Energy Cost Recovery Clause (“Energy Cost Recovery Clause”) during the Initial Term and any Extension.

(B)    Non-appealable Commission Approval Order. A non-appealable Commission approval order (“Non-appealable Commission Approval Order”) means a Commission Approval Order that is not subject to appeal to any Circuit Court of the State of Hawai‘i, the Intermediate Court of Appeals of the State of Hawai‘i, or the Supreme Court of the State of Hawai‘i, because the period permitted for such an appeal (“Appeal Period”) has passed without the filing of notice of such an appeal, or that was affirmed on appeal to any Circuit Court of the State of Hawai‘i, the Intermediate Court of Appeals of the State of Hawai‘i, or the Supreme Court of the State of Hawai‘i, or was affirmed upon further appeal or appellate process, and that is not subject to further appeal, because the jurisdictional time permitted for such an appeal and/or further appellate process such as a motion for reconsideration or an application for writ of certiorari has passed without the filing of notice of such an appeal or the filing for further appellate process.

(C)    The Companies’ Written Statement. Not later than thirty (30) Days after the issuance of a Commission Approval Order, the Companies shall provide Seller with a copy of such Commission Approval Order together with a written statement as to whether the conditions


4




set forth in Section 2.2(A) (Commission Approval Order) and Section 2.2(B) (Non-appealable Commission Approval Order) have been satisfied.

(D)    Commission Approval Date. As used in this Agreement, the term “Commission Approval Date” shall be defined as follows: If the Companies provide the written statement referred to in Section 2.2(C) (The Companies’ Written Statement) to the effect that the conditions referred to in Section 2.2(A) (Commission Approval Order) and Section 2.2(B) (Non- appealable Commission Approval Order) have been satisfied, the Commission Approval Date shall be the date of the issuance of the Commission Approval Order; or

(1)    If the Companies provide the written statement referred to in Section 2.2(C) (The Companies’ Written Statement) to the effect that only the conditions referred to in Section 2.2(A) (Commission Approval Order) have been satisfied, the Commission Approval Date shall be as follows:

(a)    if a Commission Approval Order is issued and is not made subject to a motion for reconsideration filed with the Commission or an appeal, the Commission Approval Date shall be the date one (1) Day after the expiration of Appeal Period following the issuance of the Commission Approval Order;

(b)    if the Commission Approval Order became subject to a motion for reconsideration, and the motion for reconsideration is denied or the Commission Approval Order is affirmed after reconsideration, and such order is not made subject to an appeal, the Commission Approval Date shall be deemed to be the date one (1) Day after the expiration of the Appeal Period following the order denying reconsideration of or affirming the Commission Approval Order; or

(c)    if the Commission Approval Order, or an order denying reconsideration of the Commission Approval Order or affirming approval of the Commission Approval Order after reconsideration, becomes subject to an appeal, then the Commission Approval Date shall be the date upon which the Commission Approval Order becomes a non appealable order within the meaning of the definition of a Non-Appealable Commission Approval Order in Section 2.2(B) (Non-appealable Commission Approval Order).

E.    Unfavorable Commission Order. The term “Unfavorable Commission Order” means an order from the Commission concerning this Agreement that: (i) dismisses the Companies’ application; (ii) denies the Companies’ application; or (iii) approves the Companies’ application but contains terms and conditions deemed unacceptable by the Companies in its sole discretion and therefore does not meet the definition of a Commission Approval Order as set forth in Section 2.2(A) (Commission Approval Order). If the Companies receive an Unfavorable Commission Order, the Companies shall promptly file a motion for reconsideration. If the Companies file a motion for reconsideration, the Parties’ respective obligations remain conditioned upon the receipt of the items enumerated in Section 2.2(A) (Commission Approval Order) and Section 2.2(B) (Non-appealable Commission Approval Order). If, after receipt of an Unfavorable Commission Order, the Companies file neither a motion for reconsideration nor an


5




appeal, this Agreement is null and void, and neither Party owes any further obligation to each other.

F.    Termination for [...] or Denial. [...] if the Companies’ request for Commission approval of this Agreement is denied in whole or in part, then either Seller or the Companies may terminate this Agreement by providing written notice of such termination [...]. In such event of termination, each Party shall bear its own respective fees, costs, and expenses incurred prior to termination, if any, in preparation for performance hereunder, and the Parties shall have no further obligation to each other with respect to this Agreement except for indemnity and any confidentiality obligations assumed by the Parties hereunder.


Section 2.3:    Effective Date. Upon satisfaction of the relevant conditions set forth in Section 2.2(D)(1) (a) through (c), as such conditions are applicable, this Agreement shall become effective (“Effective Date”) on January 1, 2023. Alternatively, the Parties may mutually agree in writing that some other date shall be deemed the Effective Date. Except for the obligations and provisions described herein, neither Party shall have any binding obligations under this Agreement until the Effective Date, except that the Parties agree upon the Execution Date to be bound by Sections 2.2 (Regulatory Approval), Section 11.1 (Force Majeure), and Article XVII (General Provisions). For the avoidance of doubt, on the Effective Date that certain Supply Contract for Petroleum Fuels dated January 21, 2019 by and between Seller and the Companies shall terminate and be replaced by this Agreement.

ARTICLE III
QUANTITY

Section 3.1:    Quantity of Product To Be Supplied/Delivered. Subject to the terms and conditions herein, Seller shall sell and Deliver to the Companies, and the Companies shall purchase and receive from Seller, LSFO, HSFO, Diesel, and/or ULSD as ordered by the Companies.

Section 3.2:    Purchase Volumes. During each Year that this Agreement is in effect, Seller shall sell and Deliver to the Companies, and the Companies shall purchase and receive from Seller, [...], and the Companies’ [...] that may be [...] on the islands of [...] following the notifications and coordination as outlined in Article VI (Delivery). The Companies shall take commercially reasonable steps to receive the Product ratably.
(A)    LSFO Volumes. Seller shall sell and Deliver to Hawaiian Electric, and Hawaiian Electric shall purchase and receive from Seller, LSFO pursuant to the following [...]:
1.    [...] Volumes. Seller shall have a supply obligation to provide an [...], as coordinated with Hawaiian Electric pursuant to the Nomination and coordination process set


6




forth in [...]. [...];
2.    [...] Volumes. For [...], Seller shall have a supply obligation to provide [...], as coordinated with Hawaiian Electric pursuant to the Nomination and coordination process set forth in [...]. Such amounts are designated as [...]. Notwithstanding the foregoing, [...].
3.    [...]. If [...] shall designate such [...]. Following the issuance of a [...], [...] on mutually agreeable terms that are in accordance with this Agreement. [...]
4.    Use of [...]. Seller shall [...], including [...], [...], [...] Exhibit C ([...]). For the avoidance of doubt, [...].
(B)    Planned Outage. If, prior to the LSFO Nomination due date, as set forth in Section 6.1 (Notification for LSFO), Seller declares a planned outage of Par East crude refining units [...] during the period in which [...] is to occur, then Hawaiian Electric [...], based on the [...], in accordance with [...]; provided, however, that if both Parties agree Hawaiian Electric [...], [...], [...], [...] Exhibit C ([...]) attached hereto and incorporated herein by reference.

ARTICLE IV
QUALITY

Section 4.1:    Quality of Product To Be Supplied/Delivered. Seller represents and warrants that the quality of the Product sold and Delivered by Seller and purchased and received by the Companies shall be as stated on Seller’s Certificate of Quality for such Product (“Certificate of Quality”). The quality of the Product to be sold and Delivered hereunder shall comply with the Specifications (“Specifications”) attached hereto as Exhibit A (Specifications), and made a part hereof and all applicable laws (“Laws”). If the [...] with the [...], [...] for all [...] costs and expenses, [...], [...], [...], [...], [...], [...]. By way of


7




example and without limitation, [...], [...], [...].

ARTICLE V
PRICE

Section 5.1:    Pricing. The price for the Product purchased by the Companies pursuant to this Agreement shall be calculated as set forth in Exhibit B (Pricing) which is incorporated herein by reference.

Section 5.2:    [...]. [...] with respect to [...] pursuant to this Agreement shall be [...].

Section 5.3:    Fees, Taxes, Assessments, Levies, and Imposts. [...] under this Agreement, [...]. Notwithstanding the foregoing and any [...]. At the execution of this Agreement, the taxes, assessments, levies or imposts which are currently in effect for the Product include the Hawai‘i Use Tax, the Hawai‘i General Excise Tax (4.712% for Hawaiian Electric, which includes the Honolulu County Surcharge Tax, 4.166% for Maui Electric, and 4.438% for Hawai‘i Electric Light, which includes the Hawai‘i County Surcharge Tax) and the Environmental Response, Energy, and Food Security Tax. Diesel and ULSD are also subject to the Hawai‘i Liquid Fuel Tax and the Federal Leaking Underground Storage Tank Tax. As of the Execution Date, the Environmental Response, Energy, and Food Security Tax, the Hawai‘i Liquid Fuel Tax, and the Federal Leaking Underground Storage Tank Tax are not subject to the Hawai‘i General Excise Tax and the Honolulu County Surcharge Tax.

ARTICLE VI
DELIVERY

Section 6.1:    Notification of LSFO.


8




(A)    Not less than one hundred (100) Days prior to the first Day of each Month in which LSFO is to be Delivered, Hawaiian Electric shall provide written notification [...].
(B)    Sixty (60) Days prior to the first Day of each Month in which LSFO is to be Delivered, Hawaiian Electric shall provide written notification to Seller of the Nominated volume of Delivery for said Month (“LSFO Nomination”). Seller agrees to notify Hawaiian Electric within five (5) Days of receipt of the LSFO Nomination if it cannot meet Hawaiian Electric’s Nominated volume of Delivery. [...].

(C)    The Parties shall mutually coordinate the Delivery of any marine deliveries of LSFO. Seller shall provide Hawaiian Electric with a proposed three (3) Day shipment period or window for Delivery no later than forty-five (45) Days prior to the first Day of the proposed shipment period. Hawaiian Electric shall use reasonable efforts to accommodate Seller’s proposed three (3) Day shipment period, however, should Hawaiian Electric be unable to accommodate Seller’s proposed three (3) Day shipment period:

1.    Hawaiian Electric may reject Seller’s proposed three (3) Day shipment period upon providing Seller with notice no later than three (3) Business Days following Hawaiian Electric’s receipt of Seller’s notification. In such event, Hawaiian Electric shall provide an explanation of the reason for such rejection.

2.    Seller may propose an alternate three (3) Day shipment period; provided that such alternate shipment period is within five (5) Days of the date of Seller’s first proposed three (3) Day shipment period.

3.    Seller shall provide to Hawaiian Electric the intended volume of the Product to be Delivered to Hawaiian Electric subject to a variation of plus or minus ten (10) percent with respect to the actual physical volume Delivered and a proposed one (1) Day shipment period or window which is to be within the previous three (3) Day shipment period no later than fifteen (15) Days prior to the proposed one (1) Day shipment period.

Notices given pursuant to this Section 6.1(C) may be provided by electronic mail (“Email”) or telephone.

Section 6.2:    Coordination of LSFO Delivery.
(A)    No later than ten (10) Days prior to the beginning of each Month, Seller shall provide Hawaiian Electric with a proposed schedule of Pipeline Deliveries (“Delivery Schedule”) to be made by Seller for the following two (2) Months. The proposed Delivery Schedule shall specify the approximate quantities of LSFO, the approximate date and a characterization of the approximate viscosity, either low, 15 – 40 CST at 210 DF, medium, 41 – 65 CST at 210 DF, or high, 66 – 96 CST at 210 DF, for each individual Delivery. The Deliveries are to be made at reasonably regular intervals. Hawaiian Electric shall promptly notify Seller of


9




any objections or requested changes to the Delivery Schedule provided by Seller. Seller shall also provide a ninety (90) Day expected crude resid qualities including API @ 60 DF, iron, nickle, nitrogen, sulfur, vanadium, and viscosity cst @ 210 DF.

(B)    Seller shall immediately notify Hawaiian Electric of any change in the proposed Delivery Schedule when such change becomes known to Seller. In particular, Seller shall provide a detailed and specific notice to Hawaiian Electric if a change in the proposed Delivery Schedule is due to any of the following causes:

1.    A change in the volume of an individual Pipeline Delivery if such change is in excess of 10,000 Barrels of the previously advised Delivery volume; or

2.    A change in the date of an individual Delivery, if such change is greater than two (2) Days from the previously advised date; or

3.    A change in the previously advised viscosity characterization of a Delivery.

Section 6.3:    LSFO Delivery Rates.
(A)    Hawaiian Electric shall not be required to take Delivery, and Seller shall not be required to make Delivery of more than fifty (50) percent of a Monthly Nomination in any ten
(10) consecutive Day period. Seller shall make good faith efforts to plan its Pipeline Deliveries such that it shall have a Ratable Delivery status of approximately zero (0) at month-end for the third Month of the accepted Delivery schedule.

(B)    Unless waived in advance by Hawaiian Electric, and subject to Hawaiian Electric tank availability, the physical volume of Seller’s Deliveries shall be limited to 100,000 Barrels for any individual Pipeline Delivery or 250,000 Barrels for any individual Marine Delivery.

Section 6.4:    Failure to Supply LSFO.
(A)    Failure to Supply LSFO [...]. Except in the event of [...], [...] shall result in a [...], [...] will be in a in a [...] and [...].

(B)    [...] for [...] Failure to Supply [...]. [...], [...] designed to [...]. [...] shall provide the [...] to [...] of the date that [...]. In the event of an [...], [...] will use [...] to [...] of any [...] on [...], and, to the extent practicable, [...] will [...] in [...] with [...] to [...] may [...] as a result of the [...]; provided, however, that such [...] does not [...] [...] ability to [...] as set forth in this Section 6.4(B)


10




([...] for [...] Failure to Supply [...]). If, in [...], the [...] is [...], [...] may, [...], [...] an amount of the [...] from [...] at the [...]. [...] will [...] to [...], and [...] to [...] within [...] having [...], the [...] between the [...] so [...] and the [...] as it [...] by [...], including but not limited to [...], [...], [...], and [...] such that the [...] is [...] to [...]. The [...] set forth in this Section 6.4 (B) ([...] for [...] Failure to Supply [...]) are without [...] with respect to [...] with the [...] set forth in this Agreement.

Section 6.5:    LSFO Pipeline Delivery
(A)    LSFO Pipeline Deliveries shall be made by Seller from Seller’s on-island supply through Seller’s pipelines to Hawaiian Electric at Hawaiian Electric’s BPTF. LSFO temperature shall be at least 145 DF throughout the duration of delivery, except for Hawaiian Electric BPTF tanks that are delivering LSFO, the temperature shall be 145 DF or 30 DF above pour point, whichever is greater, unless mutually agreed upon. Title to the Product and the risk of loss of the Product Delivered by Pipeline Delivery shall pass from Seller to Hawaiian Electric pursuant to Article IX (Title, Custody, and Risk of Loss).

(B)    Coordination of Deliveries. The Parties shall mutually coordinate Pipeline Deliveries into BPTF to minimize operational difficulties and costs.

(C)    Sampling. All samples, measurements and determinations drawn, taken, and made, respectively, under Section 6.5 (LSFO Pipeline Delivery) shall be for LSFO as blended in Seller’s tank prior to Pipeline Delivery. All sampling shall be done under the supervision of the Independent Inspector. Seller and Hawaiian Electric shall share equally the cost of the Independent Inspector.

(D)    Determination of Quality. The quality of the Product Delivered by Pipeline Delivery shall be determined on the basis of a volumetric weighted average composite of samples drawn by the Independent Inspector from Seller’s issuing tank(s) in such manner as to be representative of each individual Pipeline Delivery (“Tank Final Sample”).

(E)    Validation of Quality. The Tank Final Sample shall be divided into a minimum of three (3) parts as follows:

1.    One (1) part shall be provided to Seller’s laboratory for analysis to determine quality of the Product delivered.

2.    One (1) part shall be provided to Hawaiian Electric for the purpose of verifying Seller’s determinations.

3.    At least one (1) part shall be sealed and provided to the Independent Inspector to be retained for a period of at least forty-five (45) Days.


11





(F)    Certificate of Quality. Seller agrees to provide Hawaiian Electric and the Independent Inspector with the Certificate of Quality representing the samples of LSFO and will make a good faith effort to provide this Certificate of Quality no later than twenty-four (24) hours prior to the commencement of the Pipeline Delivery. If the completed Certificate of Quality is not available within said 24-hour period, Seller will advise Hawaiian Electric and the Independent Inspector of the same and, within said 24-hour period, Seller will provide to Hawaiian Electric and the Independent Inspector the final determination of API gravity, flash point, sulfur content, and sediment and water representing the Tank Final Sample.

(G)    Verification of Quality. Hawaiian Electric shall have the right to perform laboratory analyses in order to verify the results of Seller’s laboratory analyses; provided however, that such verification analyses shall be performed in a timely manner. Deliveries may be delayed until such confirmation testing is complete.

(H)    Reverse Line Displacement. In order to eliminate or minimize the volume of Seller’s pipeline fill (“Pipeline Fill”) received by Hawaiian Electric in the course of a Pipeline Delivery operation, Hawaiian Electric shall have the option to perform a Reverse Line Displacement (“Reverse Line Displacement”) whereby Seller’s Pipeline Fill is displaced to Seller using Hawaiian Electric’s fuel at the commencement of Pipeline Delivery operations.

(I)    Pipeline Blend. If Hawaiian Electric elects not to commence Pipeline Delivery operations by displacing Seller’s Pipeline Fill with Hawaiian Electric’s fuel, or if such displacement is operationally unfeasible or impractical for any other cause, Seller and Hawaiian Electric recognize that the Product received by Hawaiian Electric in a Pipeline Delivery may be a blend which includes some amount of Seller’s Pipeline Fill (“Pipeline Blend”). In such instance, the specification of Seller’s Pipeline Fill shall be determined by Seller on the basis of Seller’s samples representative of the contents of the storage tank from which Seller’s Pipeline Fill was issued. Seller shall provide Hawaiian Electric, Hawaiian Electric’s representative, and the Independent Inspector with a copy of its laboratory analysis of the quality of Seller’s Pipeline Fill prior to commencing the Pipeline Delivery.

(J)    Blend Simulation. To provide an early warning of any quality problems with the Product Delivered as a result of a Pipeline Blend, Seller shall perform a pre-shipment computer blend simulation representing the quality of Seller’s LSFO from the issuing tank(s) as indicated in the relevant Certificates of Quality or preliminary laboratory analyses of the Tank Final Samples and the quality of Seller’s Pipeline Fill as indicated in the relevant laboratory analyses. The computer blend simulation shall provide preliminary confirmation of the Pipeline Blend’s conformance with the limits for API gravity, viscosity, and percent by weight sulfur content specified in Article IV (Quality). Seller shall provide to Hawaiian Electric or Hawaiian Electric’s representative and the Independent Inspector a copy of the computer blend simulation results prior to shipment. Seller agrees that under no circumstances shall it make a Pipeline Delivery of the Product to Hawaiian Electric without Hawaiian Electric’s express written permission should the computer blend simulation or any other information available to Seller indicate a quality problem with the Product or Pipeline Blend.


12




(K)    Determination of Quantity. Under the supervision of the Independent Inspector, the quantity of the Product in a Pipeline Delivery shall be determined at the time of each Pipeline Delivery by gauging Seller’s issuing tank(s) immediately before and after pumping of the Product. Should Hawaiian Electric elect to perform a Reverse Line Displacement, the total quantity of the Product Delivered to Hawaiian Electric shall be reduced by reference to the rise in Seller’s tank(s) receiving Seller’s Pipeline Fill, determined by gauging such tank(s) immediately before and after pipeline displacement under the supervision of the Independent Inspector. Both Hawaiian Electric and Seller agree that if measurement of Seller’s tank(s) is, in the opinion of the Independent Inspector, considered to have been rendered inaccurate for reasons including, but not limited to, operational constraints or inadvertent transfer of the Product or of Seller’s Pipeline Fill within Seller’s facilities, then the quantity of the Product or Seller’s Pipeline Fill may be determined by gauging Hawaiian Electric’s receiving tank(s) before and after pumping under the supervision of the Independent Inspector.

Section 6.6:    Disputes Regarding LSFO Quality or Quantity.
(A)    Quantity Disputes.

(1)    All determinations as to the quantity of the LSFO sold and Delivered by Seller to Hawaiian Electric pursuant to this Agreement shall be calculated in accordance with current measurement standards adopted by API, ASTM-IP, and other recognized standard-setting bodies as may be applicable in the opinion of the Independent Inspector and shall be expressed in G.S.V., U.S. Barrels @ 60 degrees Fahrenheit and U.S. gallons @ 60 degrees Fahrenheit.

(2)    For Delivery of the LSFO, the Independent Inspector shall (i) prepare and sign a Certificate of Quantity stating the quantity of the LSFO determined according to the provisions of Section 6.5(K) (Determination of Quantity) and Section 6.6(A) (Quantity Disputes) that has been Delivered to Hawaiian Electric, (ii) furnish Hawaiian Electric and Seller each with a copy of such Certificate of Quantity, and (iii) inform Seller and Hawaiian Electric by Email of the quantity of the LSFO as Delivered by Seller. The data in the Independent Inspector’s Certificate of Quantity prepared as provided herein shall, absent fraud or errors and emissions, be binding and conclusive upon both Parties, and shall be used for verification of the invoice.

(3)    If Hawaiian Electric or Seller has reason to believe that the quantity of LSFO in a particular Delivery is incorrect, the Party claiming an incorrect Delivery quantity shall, within five (5) Days of the date of Delivery, present the other Party with documentation supporting such claim and the Parties will confer, in good faith, on the causes for the discrepancy and shall proceed to correct such causes and adjust the quantity, if justified, in the Delivery in question.

(B)    Quality Disputes.

(1)    The quality of LSFO sold and Delivered to Hawaiian Electric shall be as stated on Seller’s Certificate of Quality for such LSFO. Each shipment of LSFO to Hawaiian Electric shall comply with the Specifications as provided in Article IV (Quality).

(2)    If Hawaiian Electric has reason to believe that the quality of LSFO stated for a specific Delivery fails to conform to the Specifications in Article IV (Quality), Hawaiian Electric


13




shall, within five (5) Days after the later of the date of the completed Certificate of Quality or Hawaiian Electric’s determination of quality, present Seller with documents supporting such determination and the Parties will confer, in good faith, on the causes for the discrepancy. If the discrepancy is attributable to Seller, Seller shall proceed to correct such causes and adjust the quality, if justified, for the Delivery in question. In the event of an unresolved difference between Seller and Hawaiian Electric as to the quality of the LSFO, the sealed part of the representative sample in the possession of the Independent Inspector shall be provided to an independent laboratory for an independent determination of quality (“Independent Determination”), which Independent Determination shall be binding on the Parties. Seller shall be solely responsible for the cost of such Independent Determination in the event that it is determined that the quality of the LSFO in question does not conform to the Specifications.

(3)    Remedies for Non-Conforming LSFO. If the quality of the LSFO received by Hawaiian Electric fails to conform to the Specifications as provided in Article IV (Quality), both Hawaiian Electric and Seller shall attempt to minimize the impact of any quality problem. Hawaiian Electric may, in its sole discretion, issue a Specification waiver if Hawaiian Electric determines that the use of the non-conforming LSFO will not adversely affect Hawaiian Electric. If Hawaiian Electric elects not to issue a Specification waiver, Seller shall correct the non- conforming LSFO by Delivering to Hawaiian Electric additional LSFO of a quality that, when blended with the non-conforming LSFO, will result in conformance with the Specifications. Seller shall Deliver such additional LSFO to Hawaiian Electric’s storage tank(s) at BPTF or Hawaiian Electric’s O‘ahu generation stations as directed by Hawaiian Electric. If such efforts fail to resolve the failure of the LSFO to conform to the Specifications, Hawaiian Electric may return the non-conforming LSFO to Seller, in which case Seller shall replace the non-conforming LSFO by Delivering an equal volume of Hawaiian Electric verified on-Specification LSFO to Hawaiian Electric’s designated receiving tanks in a timely manner. Notwithstanding the preceding, Hawaiian Electric shall always have the right to refuse Delivery of any LSFO if Hawaiian Electric has a good faith basis to believe that the LSFO does not meet the Specifications. In such an event, either (i) Seller shall replace the non-conforming LSFO in the manner described above at the Seller’s sole cost and expense; or (ii) Hawaiian Electric may obtain the LSFO from another vendor if, in Hawaiian Electric’s reasonable discretion, Seller’s replacement of non-conforming LSFO may not be performed in time to prevent a possible interruption of Hawaiian Electric’s operations. Any remedy of non-conforming LSFO accepted by Hawaiian Electric under this Section 6.6(B)(3) (Remedies for Non-Conforming LSFO) shall not operate or be construed to remedy any similar non-conforming LSFO or to change the Specification of the LSFO acceptable to Hawaiian Electric under the terms of this Agreement.

(4)    Seller shall be solely responsible for all reasonable and documented costs and expenses, including without limitation, testing, transportation, re-refining, and emptying (but not cleaning) of storage tanks, and handling costs incurred by Hawaiian Electric in returning, replacing, or otherwise correcting the non-conforming LSFO. By way of example and without limitation, acceptable documentation for such costs and expenses are printed or electronic invoices, receipt, and similar proof of expenditure of funds.

Section 6.7:    Forecast and Notification for HSFO, Diesel, and ULSD.
(A)    Prior to the 20th Day of each Month, the Companies or each Company shall


14




give Seller a forecast of each respective Company’s Monthly volume of HSFO, Diesel, and/or ULSD for each of the coming three (3) Months (“Diesel and HSFO Volume Forecast”). In addition and also prior to the 20th Day of each Month, the Companies or each Company shall provide Seller with a schedule of each Company’s nominated barge loadings (e.g., for Moloka‘i) for the following Month. Such schedule shall show the expected place, date, and time of the commencement of each loading operation and estimated volume. For Diesel and/or ULSD delivery on O‘ahu, Hawaiian Electric will provide a delivery window. Seller will communicate any operational conflicts to the Companies within two (2) Business Days after receipt of this schedule. The Companies or each Company will endeavor to promptly update Seller of any changes that may occur.

(B)    The Companies shall be responsible for scheduling dock space for the Companies’ nominated barge with the State of Hawai‘i Department of Transportation – Harbors Division. The Companies shall also provide twenty-four (24) hour notice to Seller during Seller’s regular business hours of the final quantity to be loaded (“Cargo Letter”); provided, however, that in the event of a loading on Monday, or on Tuesday, if Monday is a holiday, the Companies shall provide Seller with the Cargo Letter by 12 noon of the previous regular Business Day. At the Companies’ option, the volumes stated in the Cargo Letter may be adjusted by +/- ten (10) percent.

Section 6.8:    Coordination for Delivery of HSFO, Diesel, and ULSD.
(A)    The Companies shall coordinate Deliveries of HSFO, Diesel, and/or ULSD with Seller:

1.    Deliveries in Bulk to Company’s Barge or from Seller’s Barge or Pipeline. Seller agrees to Deliver and the Companies agree to receive HSFO, Diesel, and/or ULSD in bulk into the Companies’ nominated barge at Kalaeloa Barbers Point Harbor. The Delivery rate for HSFO and Diesel shall be at a minimum rate of 3,000 Barrels per hour. The Delivery rate for ULSD shall be at a minimum rate of 2,000 Barrels per hour. Seller agrees to make a reasonable good faith effort to coordinate its loading of the Companies’ fuel in concert with the Companies’ concurrent loading of any other petroleum products. HSFO product temperature shall be a minimum of 110 DF throughout duration of the load. The per shipment minimum volume of ULSD to be Delivered to the Company’s nominated barge is 2,500 Barrels, and is required to be Delivered together with Diesel, unless otherwise mutually agreed upon by Seller and the Companies. Seller agrees to Deliver and the Companies agree to receive Diesel, and/or ULSD in bulk into Hawaiian Electric’s storage tanks or pipelines at BPTF, Hawaiian Electric’s CIP Generating Station, and Hawaiian Electric’s Waiau Generating Station. Seller agrees to Deliver and the Companies agree to receive LSFO, HSFO, Diesel or ULSD as Displacement Stock through Seller’s designated pipeline into the Company’s nominated tank or the Company’s nominated vessel as mutually agreed upon.
2.    Liftings from Truck Rack. Seller agrees to Deliver and the Companies agree to receive Diesel, and/or ULSD into the Companies’ nominated tanker trucks from Seller’s nominated terminal truck rack at a minimum Delivery rate of 190 Barrels per hour.


15




3.    Company’s Nominated Barge Operations, Laytime, and Demurrage. The Companies’ nominated barge shall comply with all applicable federal, state, and local laws, rules and regulations, and Seller’s vessel vetting criteria and acceptance standards, including that portion of Seller’s vessel vetting criteria as may be applicable to oceangoing tows including unmanned petroleum tank barges and associated tugs and shall be fit in every way to receive and carry the Product. Seller shall provide the Companies with its Operations Manual, if applicable, and any other applicable safety and operations procedures and vessel acceptance standards, and any amendments thereto, during the term of this Agreement. While at Seller’s loading pier, the Companies’ nominated barge shall operate in compliance with Seller’s Operations Manual as approved by the United States Coast Guard. Seller will provide one (1) dedicated Person in Charge (“PIC”) at the Companies’ designated load pier before the designated commencement of the Companies’ required barge load. In addition, a minimum of two (2) qualified tankermen shall be provided by the Companies’ nominated barge during all loading operations at Seller’s loading pier or third-party pier.
The Companies’ nominated barge shall vacate Seller’s loading pier or third-party pier as soon as loading is completed, except if there is a delay caused by any event or acts beyond the reasonable control of the Companies, including but not limited to acts of God, fire, governmental acts, or labor disturbances.
Dues and other charges on the Companies’ nominated barge (whether or not such dues or charges are based on the quantity of Product loaded or on the freight and without regard from whom such dues or charges are withheld) shall be paid by the Companies. Any taxes on freight shall be borne by the Companies. The Companies shall be responsible for any State of Hawai‘i fee imposed for use of Seller’s loading pier or third-party pier in the nature of wharfage or pipeline toll.
Neither Seller, nor any of its associated or affiliated companies, nor any of the employees, servants, representatives and agents of any of the foregoing, shall be responsible for any losses, damages, delays or liabilities resulting from any negligence, incompetence or incapacity of any pilot, line handler, mooring master required at Seller’s loading pier or third-party pier or employed by the Companies or otherwise assisting the Companies at the expressed authorization of the Companies or the Companies’ agent or the personnel of any tug(s) or other support vessels or arising from any unseaworthiness or any insufficiency of any tug or other support vessel employed by the Companies or otherwise assisting the Companies at the expressed authorization of the Companies or the Companies’ agent and the Companies agree to indemnify and hold Seller harmless from and against any and all such losses, damages, delays, or liabilities.
At Seller’s loading pier or third-party pier, laytime shall commence one (1) hour prior to Companies’ nominated barge load time as designated in the Companies’ Cargo Letter. [...]. In the event that a part cargo or part cargoes belonging to a third party or third parties is/are loaded onto the Companies’ nominated barge, allowable laytime shall be prorated and the Companies’ allowable laytime shall be calculated on the basis of the ratio of the bill of lading volume of the


16




Companies’ cargo to the total bill of lading volume of the entire cargo loaded onto the Companies’ nominated barge or vessel. Laytime shall cease when the Companies’ nominated barge is released for departure; however, in the event part cargoes are loaded for the Companies and a third party or parties, the Companies’ laytime shall commence as provided above if the Companies’ cargo is loaded first, or shall commence upon commencement of loading of the Companies’ cargo if the Companies’ cargo is not the first to be loaded, and shall cease upon completion of loading of the Companies’ cargo.
[...] shall be [...] and any [...] (or [...], as the case may be) for [...] and [...] for [...] of [...] in [...] of [...] laytime. In the event the condition of the Companies’ nominated barge renders it incapable of receiving cargo at the minimum Delivery rate, such that the time spent loading the Companies’ nominated barge (all cargoes) is in excess of allowable laytime, Seller shall have the right to suspend loading operations and order the Companies’ nominated barge to vacate Seller’s loading pier or third-party pier. Seller shall not be liable for demurrage to the extent that allowed laytime is exceeded due to the condition of the Companies’ nominated barge or tug, or is due to events or acts beyond Seller’s reasonable control.

Section 6.9:    Determination of Quantity for HSFO, Diesel, and ULSD.
(A)    Quantity determination of the Product Delivered by Seller in bulk to the Companies’ nominated barge on O‘ahu shall be made by the Independent Inspector’s gauging of Seller’s Product issuing tanks before and after Delivery.

(B)    Quantity determination of the Product Delivered by Seller in bulk to the Companies’ nominated marine terminal at Kahului, Hilo, or Kaunakakai shall be determined at the time of each Delivery by gauging the receiving tanks at the Companies’ nominated marine terminal before and after discharge.

(C)    The Quantity determination of ULSD Delivered from Seller’s nominated terminal to the Companies’ nominated truck(s) or in Seller’s nominated truck(s) shall be made at the time of each Delivery by Seller’s calibrated loadrack meters, converted in each instance to volume @ 60 DF by the automated rack control system. Meters shall be calibrated on an annual basis or as required and agreed upon by Seller and the Companies. The Companies shall have the right at their expense and in accordance with procedures at Seller’s nominated terminal to independently certify said calibration. The Companies and Seller shall each have the right to have one (1) representative present to witness such meter calibration.

(D)    Quantity determination of the Product Delivered will be made in accordance with applicable API, ASTM, and IP guidelines and shall be expressed in G.S.V., U.S. Barrels @ 60 DF and U.S. gallons @ 60 DF.

Section 6.10: Disputes Regarding Quantity or Quality of HSFO, Diesel, and ULSD.
(A)    Quantity Disputes.


17




(1)    Quantities of the Product sold and Delivered shall be determined at the time of each Delivery by the Independent Inspector’s gauging of Seller’s Product issuing tanks before and after Delivery.

(2)    Quantity determination of the Product Delivered will be made in accordance with applicable API, ASTM, and IP guidelines and shall be expressed in G.S.V., U.S. Barrels @ 60 DF and U.S. gallons @ 60 DF.

(3)    For Delivery of the Product in bulk, the Independent Inspector shall (i) prepare and sign a Certificate of Quantity stating the quantity of the Product determined according to the provisions of Section 6.10 (Disputes Regarding Quantity or Quality of HSFO, Diesel, and ULSD) to have been Delivered to the Companies, (ii) furnish the Companies and Seller each with a copy of such Certificate of Quantity, and (iii) advise Seller and the Companies by Email of the quantity of the Product Delivered. The data in the Independent Inspector’s Certificate of Quantity prepared as provided herein shall, absent fraud or errors and omissions, be binding and conclusive upon both Parties, and shall be used for verification of the invoice and Bill of Lading for barge deliveries.

(4)    If the Companies or Seller has reason to believe that the quantity of the Product for a particular Delivery is incorrect, such Party asserting a belief that the quantity is incorrect shall, within five (5) Days of the date of Delivery, present the other Party with causes for the discrepancy and shall proceed to correct such causes and adjust the quantity, if justified, for the Delivery in question as specified in Section 6.8 (Coordination for Delivery of HSFO, Diesel, and ULSD).

(B)    Quality Disputes of HSFO, Diesel, and/or ULSD.

(1)    The quality of Diesel and/or ULSD Delivered by Seller to the Companies’ nominated truck(s) or in Seller’s nominated truck(s) to the Companies’ Site Locations shall be determined on the basis of a volumetric weighted average composite of samples drawn by an Independent Inspector or Seller representative from Seller’s nominated terminal issuing tank(s) after the completion of each bulk receipt into such terminal tanks in such a manner as to be representative of the volume of the tank inventory from that time until the time of the next bulk receipt. Such samples of Diesel and/or ULSD shall be divided into a minimum of two (2) parts, one (1) of which shall be tested by Seller for API, BTU, sulfur, and Cetane and the other retained by an Independent Inspector, for a period of not less than forty-five (45) Days.

(2)    The quality of the Product Delivered by Seller to the Companies’ nominated barge or by Seller to the harbor terminal piping or by Seller from its nominated barge to the Companies’ nominated terminal shall be determined on the basis of a volumetric weighted average composite of samples drawn by an Independent Inspector or Seller representative from Seller’s refinery or nominated terminal tank(s) (“Tank Composite”) in such a manner as to be representative of the volume of the tank inventory. The Tank Composite shall conform to the Specifications in Exhibit A (Specifications). The Tank Composite preshipment report will be issued prior to loading. The Tank Composite Certificate of Quality will be issued within twenty-


18




four (24) hours after completion of the load. Such tank samples of the Product shall be divided into a minimum of three (3) parts as follows:
1.    One (1) part shall be provided to Seller’s laboratory for analysis to determine quality.
2.    One (1) part shall be provided to Hawaiian Electric for the purpose of verifying Seller’s determinations.
3.    At least one (1) part shall be sealed and provided to the Independent Inspector to be retained for a period of at least forty-five (45) Days.

(3)    The quality of the Product Delivered by Seller to the Companies’ nominated barge (“Barge Composite”) shall also conform to Specifications in Exhibit A (Specifications) for confirmation tests. The Barge Composite Certificate of Quality will be issued within twenty-four (24) hours after completion of the load. The Barge Composite samples will be drawn from the Companies’ nominated barge by an Independent Inspector for the purpose of conducting the confirmation tests, and in such a manner as to be a volumetric weighted average composite of each Product drawn from the cargo tanks at the completion of the load. Such Barge Composite samples of the Product shall be divided into a minimum of three
(3)    parts as follows:
1.    One (1) part shall be provided to Seller’s laboratory for analysis to determine quality of the Confirmation Tests.
2.    One (1) part shall be provided to Hawaiian Electric for the purpose of verifying Seller’s determinations.
3.    At least one (1) part shall be sealed and provided to the Independent Inspector to be retained for a period of at least forty-five (45) Days.

(4)    If Seller or the Companies have reason to believe that the quality of the Product stated for a specific Delivery fails to conform to the Specifications in Exhibit A (Specifications), that Party shall, within five (5) Days after the later of the date of the completed Certificate of Quality or the date of the final determination of quality, present the other Party with documents supporting such determination and the Parties will confer, in good faith, on the causes for the discrepancy and shall proceed to correct such causes and adjust the quality, if justified, for the Delivery in question. In the event of an unresolved difference between Seller and the Companies, the sealed part of the representative sample in the possession of the Independent Inspector shall be provided to an independent laboratory for an official determination, which shall be final. Seller and the Companies shall share equally the cost for such independent laboratory determination.

(5)    If the quality of the Product received by the Companies fails to conform to the quality Specifications in Exhibit A (Specifications), the Companies and Seller shall attempt to minimize the impact of any quality problem. At the Companies’ reasonable discretion, such efforts may include a Specification waiver if the use of the Product will not unreasonably cause harm to the Companies. Or, Seller may attempt to remedy the Specification issue by Delivering higher quality Product in a timely manner to produce a blend that conforms to the Specifications in the Companies’ storage tank(s) at the Companies’ receiving facility. If all such and similar efforts fail to resolve the Specification issue, then the Companies may return non-Specification Product to Seller, in which case Seller shall replace the non-Specification Product by Delivering an equal volume of the Companies’ verified on-Specification Product to the Companies in a


19




timely manner. Notwithstanding the preceding, the Companies shall always have the right to refuse Delivery of any Product with prior written notice to Seller or its permitted agents if the Companies in good faith shall have reason to believe that the Product does not meet the Specification. The Companies may, at their collective option, seek other supplies of the Product if in the Companies’ reasonable discretion the Delivery of non-conforming Product may not be remedied in time to prevent a possible interruption of their operations. All reasonable and documented costs and expenses of remedying the Delivery of non-conforming Product, or arising from non-conforming Product (including, without limitation, the testing, transportation, re-refining, and handling costs incurred in returning, replacing or otherwise correcting off- Specification Product, the emptying (but not cleaning) of storage tanks containing non- conforming Product shall be paid by Seller. By way of example and without limitation, acceptable documentation for such costs and expenses are printed or electronic invoices, receipts, and similar proof of expenditure of funds. Any remedy of non-conforming Product accepted by the Companies under this Section 6.10(B)(5) shall not operate or be construed to remedy any similar non-conforming Product or to change the Specification of the Product acceptable to the Companies under the terms of this Agreement.

(6)    Seller shall be solely responsible for all reasonable and documented costs and expenses, including testing, transportation, re-refining, and handling costs incurred by the Companies in returning, replacing, or otherwise correcting off-specification Product. By way of example and without limitation, acceptable documentation for such costs and expenses are printed or electronic invoices, receipts, and similar proof of expenditure of funds.

Section 6.11: Failure to Supply HSFO, Diesel, and/or ULSD.
(A)    Except in the [...] or an [...] to the [...], if [...] to [...] the [...] in the [...], [...] shall [...] to the [...]. [...] shall be [...] to be in an [...] and shall [...] of the same [...] if any of the [...] are [...]: [...], [...], or [...] of the [...] in the [...] of the [...].

(B)    In the [...] is in a [...], [...] shall [...] to [...] the [...] of that [...] such that [...] an [...] to [...], and, to the [...], [...] will [...] in [...] with [...] to [...] any [...] may [...] as a [...] of the [...]; provided, however, that such [...] does not [...] [...] to [...] as set forth in this Section 6.11(B). While [...], [...] may [...] to [...]. [...] will [...], and [...] shall [...] within [...] of [...], the [...], and the [...] if it [...], including but not limited to [...], and [...] such that the [...] is [...] to [...].

Section 6.12: Records/Right to Audit. Seller shall retain any and all documents and records


20




regarding the Delivery, quantity, and quality of the Product sold under the terms of this Agreement for the later of twelve (12) Months after the date of the invoice for such Product, or in the event of any dispute concerning the quantity or quality of the Product, until any such dispute is resolved. Upon request by the Companies, Seller shall promptly make such records available at a location designated by the Companies for review thereof.

Section 6.13: Inspection. The Companies may participate in all sampling, quality, inspection, measurements, and tests of the Product which may be conducted pursuant to this Agreement.
The Companies may also inspect any equipment owned or controlled by Seller that is used in determining the quantity or quality of the Product, provided that any such participation by the Companies shall not materially interfere with or otherwise disrupt the inspection, measurement, and tests conducted by Seller. Upon reasonable notice to Seller and during normal business hours, the Companies may, at their sole expense, inspect and audit any sample analysis of the Product conducted by or for Seller. Such inspection and audit rights shall include the review of records and data used in the preparation of such analysis.

Section 6.14: Independent Inspector. The Companies and Seller mutually shall agree on the appointment of the Independent Inspector and such agreement shall not be unreasonably withheld by either Party. All samples, measurements, and determination samples as provided in this Agreement shall be drawn, taken, and made under the supervision of the Independent Inspector, who shall attend Deliveries of the Product as designated by the Parties or as otherwise provided for in this Agreement. All charges for services rendered by the Independent Inspector shall be borne equally by the Companies and Seller except as otherwise provided in this Agreement.

ARTICLE VII
REPRESENTATIONS AND WARRANTIES

Section 7.1:    Seller’s Representations and Warranties. In addition to any other representations and warranties of Seller set forth in this Agreement, Seller represents, and warrants as follows, in each case subject to the terms of this Agreement:

(A)    Ability to Supply. Throughout the Initial Term and any Extension, Seller shall supply the Product in conformance with the Specifications in the amounts necessary to meet all of Seller’s obligations under this Agreement.

(B)    Ability to Deliver.
1.    Through the Initial Term and any Extension, for truck rack Deliveries, Seller shall own, lease, or have the right to use facilities sufficient to meet Seller’s Delivery obligations under this Agreement.
2.    Through the Initial Term and any Extension, for Pipeline Deliveries, Seller shall own, lease, or otherwise have the legal right to use facilities sufficient to meet Seller’s Delivery obligations under this Agreement.
3.    Through the Initial Term and any Extension, for marine Deliveries, Seller’s nominated vessel employed to Deliver the Product to Hawaiian Electric shall comply with all regulations, pier operator’s standards for vessel acceptance quality, pollution mitigation, required


21




pollution liability, Protection and Indemnity Insurance (“P&I”) and other insurance coverages, pier operators Operations manual and accept liability for dues and other charges on said vessel sufficient to meet Seller’s Delivery obligations under this Agreement.
4.    Through the Initial Term and any Extension, for barge Deliveries, Seller’s nominated vessel employed to Deliver the Product to the Companies shall comply with all regulations, pier operator’s standards for vessel acceptance quality, pollution mitigation, required pollution liability, P&I and other insurance coverages, pier operators Operations Manual and accept liability for dues and other charges on said vessel sufficient to meet Seller’s Delivery obligations under this Agreement.

(C)    Quality. All Product Delivered hereunder will be so Delivered in compliance with the terms of the Agreement.

(D)    Right, Title, and Interest. Seller possesses all title to, right, and interest in the Product to be sold and Delivered to the Companies pursuant to this Agreement. Seller will Deliver the Product to the Companies free and clear of all liens, security interests, claims, and encumbrances or any interest therein and thereto by any person.

Section 7.2:    Mutual Representations and Warranties. In addition to any other representations and warranties set forth in this Agreement, Seller and the Companies each agrees, represents, and warrants as follows:

(A)    Duly Organized. Each Party is duly organized, validly existing, and in good standing under the laws of the State of Hawaiʻi. Each Party has full power, authority, and legal right to execute, deliver, and perform its obligations under this Agreement.

(B)    No Conflict. Each Party’s performance of its obligations under this Agreement will not result in a violation of, or be in conflict with, any provisions of its articles of incorporation, bylaws, and/or other organizational documents, or result in a violation of, or be in conflict with, or constitute a default under any mortgage, indenture, contract, agreement, or other instrument to which it is a party or by which it or its property is bound, where such violation, conflict, default, or potential default would materially adversely affect its ability to perform its obligations under this Agreement, or result in a violation of any statute, rule, order of any court or administrative agency, or regulation applicable to it or its property or by which it or its property may be bound, or result in a violation of, or be in conflict with, or result in a breach of, any term or provision of any judgment, order, decree or award of any court, arbitrator, or governmental or public instrumentality binding upon it or its property, in each case where such violation, conflict, or breach would have a material adverse effect on its ability to perform its obligations under this Agreement.

(C)    No Default. Each Party represents and warrants that it is not in default, and no condition exists which, with notice or lapse of time, or both, would constitute a default by it under any mortgage, loan agreement, deed of trust, indenture or other agreement with respect thereto, evidence of indebtedness or other instrument of a material nature, to which it is party or by which it is bound, or in violation of, or in default under, any rule, regulation, order, writ, judgment, injunction or decree of any court, arbitrator or federal, state, municipal or other


22




governmental authority, commission, board, bureau, agency, or instrumentality, domestic or foreign, in each case where such default, condition or violation would have a material adverse effect on its ability to perform its obligations under this Agreement.

(D)    No Litigation. Each Party represents and warrants that there is no action, suit, proceeding, inquiry or investigation (“Proceeding”), at law or in equity, or before or by any court, public board or body, pending against it, or of which it has otherwise received official notice, or which to its knowledge is threatened against it, wherein an adverse decision, ruling or finding would reasonably expect to have a material adverse effect on its ability to perform its obligations under this Agreement. For the avoidance of doubt, the Companies’ representation and warranty pursuant to this Section 7.2(C) (No Litigation) excludes any Proceeding under Section 2.2 (Regulatory Approval).

(E)    Experience, Qualifications, and Resources. Each Party represents that it has entered into this Agreement in connection with the conduct of its business and it has the experience, qualifications, and financial resources necessary to perform its obligations hereunder.

(F)    Continuing Obligation. Each Party’s representations and warranties as set forth in this Article VII (Representations and Warranties) are continuous for the extent of the Initial Term and any Extension. Each Party shall provide notice to the other Party of the occurrence or non-occurrence of any event that compromises its representations and warranties made herein promptly following its knowledge thereof. Except for the representations and warranties expressly made herein, neither Party makes any express or implied representation or warranty.


ARTICLE VIII
INVOICING AND PAYMENT

Section 8.1:    Invoicing.
(A)    Invoices, which will show the price [...]. Original invoices shall include full documentation, as approved by both Parties, including the Certificate of Quality, report of the Independent Inspector, and price calculation; such documentation may, however, be provided by Seller to the Companies separately.

(B)    Invoices will be prepared and dated by Seller following Delivery of the Product to the Companies. Invoices, invoice documentation, laboratory analyses and other documents having to do with the quality, quantity, and Delivery of the Product or otherwise with the Product sold and purchased hereunder shall be sent by Email to each respective Company at email addresses that will be provided by the Companies.


(C)    Invoicing of sales and Deliveries of LSFO to Hawaiian Electric on any invoice date shall be limited to a quantity such that Seller’s Delivery status against Ratable (for this


23




purpose calculated on the basis of cumulative invoiced Deliveries less cumulative Nominations as of the end of the Month which includes the invoice date) does not exceed zero (0).

Section 8.2:    Payment.
(A)    Method of Payment. [...]. Details about the Seller’s banking information will be mailed directly to Hawaiian Electric’s Treasury Division in accordance with the Notice requirements set forth in Section 16.1 (Notices) below before the first invoice is sent.

[...]

(B)    If a debit memo incorporating an adjustment to a previously issued invoice has been sent to the respective Company subsequent to said Company making payment of said original invoice, then said Company shall make payment in accordance with the provisions of this Section 8.2 (Payment). [...]

(C)    If an [...] an [...] that is [...] has [...] to the [...], then [...] shall [...] in accordance with [...] for that [...] of the [...] that is [...] by [...] and in which case, [...] shall make [...] to [...] and other [...] as are [...] the [...].

ARTICLE IX
TITLE, CUSTODY, AND RISK OF LOSS

Section 9.1:    Title, Custody, and Risk of Loss.

(A)    Deliveries to the Companies’ Nominated Site Locations. Title, custody, and risk of loss concerning the Product Delivered by Pipeline Delivery shall pass from Seller to Hawaiian Electric at the connection between the flange of Seller’s pipeline and Hawaiian Electric’s pipeline. All Diesel and/or ULSD shall be dyed by Seller in accordance with state and federal requirements for tax-exempt, off-road diesel fuel.


24




(B)    Marine Deliveries into BPTF. Title to the Product Delivered by marine Delivery shall pass from Seller to Hawaiian Electric at BPTF as soon as the quality of Hawaiian Electric’s receiving tank is determined by Seller to meet the Specification in Exhibit A (Specifications), subject to Hawaiian Electric’s timely verification, or at Hawaiian Electric’s option, Hawaiian Electric’s verbal notice to Seller allowing release for shipment prior to verification. The risk of loss of the Product or the components thereof by marine Delivery shall pass from Seller to Hawaiian Electric at the connection between the flange of Seller’s pipeline and Hawaiian Electric’s nominated pipeline at Hawaiian Electric’s BPTF; provided, however, that in the event an actual physical loss of the Product or the components thereof is caused by qualities of the Product or the components thereof, e.g., low flash point causing a fire, or due to Seller’s gross negligence or willful misconduct, Seller shall bear the risk of loss.

(C)    Deliveries at Seller’s Nominated Terminals. For ULSD Delivered from Seller’s nominated terminal into the Companies’ nominated truck(s), title, custody and the risk of loss of ULSD so Delivered shall pass from Seller to the Companies at the flange connecting the loadrack arm/hose at Seller’s nominated terminal’s truck loading facility to the receiving equipment of the Companies’ nominated truck(s), and ULSD shall be dyed by Seller in accordance with state and federal requirements for tax-exempt, off-road diesel fuel.

(D)    Deliveries to the Companies’ Nominated Barge. For Product delivered in bulk to the Companies’ nominated barge at either (i) Seller’s loading pier, or (ii) a third-party pier, title, custody, and risk of loss of the Product so Delivered shall pass from Seller to the Companies at (for i and ii) the flange of the receiving hoses of the Companies’ nominated barge at Seller’s loading pier or third-party pier. If required by the Companies, the Diesel shall be dyed by Seller, in accordance with state and federal requirements for tax-exempt, off-road diesel fuel. In the case of Diesel and/or ULSD, risk of loss shall pass from Seller to the Companies at the flange of the receiving hoses of the Companies nominated vessel, and title and custody shall pass after any dye or lubricity is added by Seller.

(E)    Deliveries by Seller’s Nominated Barge. For Product delivered in bulk to the pier, title, custody, and risk of loss of the Product so Delivered shall pass from Seller to the Companies at the connection flange of the receiving pipeline at Companies’ nominated marine terminal.

ARTICLE X
INSURANCE

Section 10.1: Insurance Requirements. Seller and anyone acting under its direction or control or on its behalf shall at its own expense procure and maintain in full force and effect at all times during the Initial Term and any Extension the following insurance and all other forms of insurance that may be required by any applicable Law:

(A)    Cargo insurance, which is to remain in force during the period of transportation until title to and risk of loss of the Product passes to the Companies in accordance with Section 9.1(A) (Deliveries to the Companies’ Nominated Site Locations). Such insurance shall be in an amount of no less than the purchase price including freight and cover all of the risks covered


25




under a standard Lloyd’s Maritime Insurance policy, including all the denominated “Institute Cargo Clauses” (Free of Particular Average, F.P.A. and clauses referring to wars, strikes, riots and civil disturbances).

(B)    Hull and Machinery Insurance shall be placed and maintained with reputable marine underwriters and insured for no less than the full replacement value of the vessel.

(C)    Protection & Indemnity Insurance (“P&I Insurance”) shall be placed and maintained with full P&I indemnity cover in the ordinary course from a P&I Club that is a member of the International Group of P&I Clubs, including pollution liability standard for vessel and Certificate of Financial Responsibility.

(D)    Standard Workers Compensation and Employers Liability Insurance endorsed to be applicable to the State of Hawai‘i as well as the Longshore Act, with statutory limits for workers compensation and limits of $5,000,000 per occurrence for employer’s liability.

(E)    Commercial General Liability Insurance covering liability for bodily injury and property damage arising from premises, operations, products-completed operations, personal and advertising injury and liability assumed under an insured contract (including the tort liability of another assumed in a business contract) for damages arising out of the agreement and shall, at a minimum, include coverage for (i) all operations and premises of Seller; (ii) all products and completed operations of Seller; (iii) explosion, collapse and underground (XCU) hazards; and
(iv) duty to defend, with minimum limits of $10,000,000 each occurrence; and $10,000,000 general aggregate.

(F)    Pollution Legal Liability Insurance with minimum limits of $5,000,000 per occurrence and $5,000,000 general aggregate for the full scope of the Seller’s operations (ongoing and completed) as described within the scope of work for this Agreement. Coverage to include but not be limited to: third party liability for bodily injury to persons, property damage resulting from any spill, leak, or discharge into the air, surface water, ground water, land surface or subsurface strata, and defense arising from the operations; diminution of value and Natural Resources damages; contractual liability. Such insurance shall include coverage for clean-up and remediation expenses that are not subject to sub-limits.

(G)    Automobile Liability Insurance on all owned, hired, rental and non-owned vehicles used in conjunction with the Delivery of Product to the Companies and shall include uninsured/underinsured motorist and no-fault insurance provisions wherever applicable and otherwise comply with applicable law, with minimum limit of $5,000,000 combined single limit each accident. Such policy shall include endorsement CA 9948 Pollution Liability Broadened coverage for covered autos. Further, where required by law, Seller, and its subcontractors and subcontractors’ coverage shall include the MCS 90 endorsement.

(H)    Other Coverage. Seller and anyone acting under its direction or control or on its behalf shall at its own expense procure and maintain in full force and effect at all times during the term of this Agreement on all owned, non-owned and hired vehicles used in conjunction with the Delivery of Product to Hawaiian Electric, any other insurance or surety bonding that may be


26




required under the laws, ordinances and regulations of any governmental authority, including the Federal Motor Carrier Act of 1980 and all rules and regulations of the DOT and/or the USDOT.

Section 10.2: Insurance Paid. Premiums for all necessary insurance policies are included in the Delivered price of the Product as determined in Section 5.1 (Pricing). No special payments shall be made by the Companies to Seller in respect to such premiums.

Section 10.3: Waiver of Subrogation. Seller and anyone acting under its direction or control or on its behalf will cause its insurers (except for Workers Compensation insurance) to waive all rights of subrogation related to the scope of work herein and as agreed hereunder which Seller or its insurers may have against the Companies, the Companies’agents, or the Companies’ employees.

Section 10.4: Hawaiian Electric, Hawaiʻi Electric Light, and Maui Electric As Additional Insured. Insurance policies (except for Workers Compensation insurance) providing the insurance coverage required in this Agreement will name the Companies, the Companies’ agents or the Companies’ employees as an additional insured. Coverage must be primary in respect to the additional insured. Any other insurance carried by the Companies will be excess only and not contribute with this insurance.

Section 10.5: Certificates of Insurance. Before performance of this Agreement, Seller shall provide to the Companies’ designated representative certificates of insurance, or other documentary evidence acceptable to the Companies, certifying that each of the Seller’s foregoing insurance coverages is in force, and further providing that the Companies will be given thirty
(30)    Days’ written notice of any cancellation of, or intent not to renew any of the required policies. Seller shall promptly provide new insurance certificates reflecting the required policies in the event of any change in coverage. Receipt of any certificate showing less coverage than required is not a waiver of Seller’s obligation to fulfill the coverage requirements.

Section 10.6: Failure to Procure Insurance. In the event Seller fails to procure and/or maintain an insurance as required above, an insurance fails for any reason (including, without limitation, breach of policy condition or warranty) and/or an insurer otherwise refuses or is unable to pay, the Party required to procure that insurance shall be deemed an insurer or self-insurer, shall accept and pay claims which would have otherwise been submitted to the failed insurance and shall indemnify and hold harmless (including legal fees and costs) the other Party of and from any loss, damage, expense, claim, liability, and/or suit resulting from such failure.


ARTICLE XI
FORCE MAJEURE

Section 11.1: Force Majeure.
(A)    Neither Party shall be liable in any manner for failure to Deliver or to receive the Product or any other failure to perform or delay in performing any obligations under this Agreement for the time and to the extent such failure or delay is caused by an event or act of force majeure (“Force Majeure”), which shall be defined as an act of God, pandemic, hurricane, flood, volcanic


27




eruption, earthquake, tsunami, war, rebellion, insurrection, strikes, inability to secure materials or labor by reason of allocations promulgated by authorized governmental agencies, lockout, fire, explosion, destruction or catastrophic failure from any involuntary cause of Seller’s vessel, terminal, refineries, pipelines, container, or of the Companies’ receiving facility, public or private harbor and docking facility, or any significant part thereof; or compliance, voluntary or involuntary, with a direction of any governmental authority or person purporting to act with government authority, including any such direction limiting the Companies’ recovery of all fuel costs incurred under this Agreement; or any other cause or causes (except financial) not within the control of the affected Party. [...]

(B)    Continuing Payment Obligation. In no event, however, shall the Companies be excused from their obligation to make payments due for the Product delivered for which title has transferred hereunder.

(C)    [...] of the [...]. If [...] is [...] or [...] to an [...] or [...] of [...], it [...] for [...] to [...] from a [...] than [...] or [...] to [...] to a [...] than [...] for the [...] of [...] which [...] do [...] or [...]; and [...] be [...] to [...] or [...], each as [...], after the [...] or [...], the [...] of [...] which [...] have been [...] and [...] during the [...] of [...] or [...].

(D)    Effects of Coronavirus/COVID-19. The Parties recognize and agree that there is an ongoing epidemic at the time of execution of this Agreement, namely the coronavirus/COVID-19 pandemic, the full effects of which are presently unknown. The Parties agree that if coronavirus/COVID-19 impacts a Party’s performance, that Party will provide notice to the other Party in the manner as set forth in Section 11.1(E)(1)(a) (Initial Written Notice) and Section 11.1(E)(1)(b) (Written Explanation).

(E)    Consequences of Force Majeure.

(1)    Satisfaction of Certain Conditions. Section 11.1(G) (Effect on Performance) excuses certain liabilities of a Party for delay and/or failure in performance to the extent such delay or failure is the result of conditions, acts or events of Force Majeure; provided, however, that a non-performing Party is only entitled to Force Majeure to the extent the following conditions are satisfied:

(a)    Initial Written Notice. The non-performing Party gives the other Party prompt initial written notice stating that such non-performing Party considers such condition, act, or event to constitute a Force Majeure and describing, to the extent practicable under the circumstances, the particulars of such Force Majeure condition, act, or event;


28




(b)    Written Explanation. As soon as reasonably practicable after giving initial written notice as set forth in Section 11.1(E)(1)(a) (Initial Written Notice), the non-performing Party gives the other Party a written explanation of the Force Majeure condition, act, or event, its anticipated effect on the non-performing Party’s performance, the anticipated duration of any suspension or reduction in the non-performing Party’s performance under this Agreement, and when it expects the Force Majeure condition or event to end. The written explanation shall also include evidence reasonably sufficient to establish that the occurrence constitutes Force Majeure;

(c)    The suspension of performance is of no greater scope and of no longer duration than is required by Force Majeure;

(d)    The non-performing Party proceeds with due diligence to remedy its inability to perform and provides progress reports (as reasonably requested by the other Party) describing, to the extent practicable, actions taken to end or minimize the effects of the Force Majeure and the anticipated duration of the Force Majeure; and

(e)    When the non-performing Party is able to resume performance of its obligations under this Agreement, such Party shall give the other Party written notice to that effect.

(F)    Reasonable Efforts. The Party excused from performance under this Agreement shall, to the extent practicable, use commercially reasonable efforts to cure, mitigate, or remedy such Force Majeure event. Except as set forth in Section 11.1(B) (Continuing Payment Obligation), any payments dues as compensation for the obligation so excused shall also be excused for so long as the obligation is not performed due to Force Majeure.

(G)    Effect on Performance. Neither Party shall be liable in any manner for any delays or failures in its performance under this Agreement to the extent such failures or delays are caused by conditions, acts, or events of Force Majeure. Except as otherwise expressly provided for in this Agreement, the existence of an event of Force Majeure shall not relieve the Parties of their obligations under this Agreement to the extent that performance of such obligations is not affected by the event of Force Majeure.

ARTICLE XII
COMPLIANCE WITH LAWS AND REGULATIONS

Section 12.1: Compliance with Laws and Regulations.
(A)    This Agreement is subject to and the Parties shall comply with all applicable present and future Laws.

(B)    If the Delivery or supply of the Product pursuant to this Agreement conflicts with or is limited or prohibited by any applicable Law, then to the extent of such conflict, limitation or prohibition, Seller shall have no obligation to Deliver or supply the Companies with the Product under this Agreement and the Companies shall have no obligation to purchase or receive the Product under this Agreement. The Companies, in the Companies’ discretion, may elect to complete and file any and all required federal or state regulatory forms to permit, facilitate, or


29




enable the supply of the Product to the Companies under this Agreement. Seller shall fully cooperate with the Companies in the completion and filing of the foregoing forms. If the Companies’ purchase, receipt, or use of the Product pursuant to this Agreement conflicts with or is limited or prohibited by any Law, then to the extent of such conflict, limitation, or prohibition, the Companies shall have no obligation to purchase and receive the Product under this Agreement.

(C)    If, [...] the [...] or any [...], any [...] is [...] or a [...], including, without limitation, [...], and [...] or [...] has a [...] upon either [...] to [...] under this Agreement, then the [...] shall [...] to [...] for [...] of the [...]. Such [...] shall be [...] by the [...] no later than [...] after such [...] comes [...], by [...] to the other Party of the [...] in accordance with the [...]. Within [...] after the date of such notice, the Parties [...] and in the event that the Parties [...] within [...] after the date of [...], the [...] shall have the right to [...] giving notice of such [...] to the [...]. Such notice [...] shall be given within [...] immediately following the [...] period. Until [...], or until [...] is [...] as provided in this Section 12.1(C), the [...].

Section 12.2: Material Safety Compliance. Seller warrants that it is fully informed concerning the nature and existence of risks posed by transporting, storing, using, handling, and being exposed to the Product. Seller shall furnish to the Companies health, safety, and environmental information (including without limitation material safety data sheets) (“HSE Data”), concerning health, safety, and environmental aspects of the Product purchased by the Companies, including health, safety, and environmental warnings, if any, required by applicable Law. Seller shall not be entitled to rely upon such HSE Data as being an inclusive presentation of all potential health, safety, and environmental risks associated with the Product to be Delivered by Seller. Seller shall furnish HSE Data to, and otherwise inform, Seller’s nominated vessel of all such risks, and the master of such vessel shall advise and instruct all crew, seamen, and employees of the vessel about the hazards, if any, associated with the Product and the safe and proper methods of handling and storing the Product. Compliance by the Seller with recommendations in HSE Data shall not excuse the Seller from its obligations under this Section 12.2 (Material Safety Compliance) and Article XIV (Indemnity).

Section 12.3: Permits and Licenses. Seller shall secure and pay for all required permits and licenses applicable to this Agreement, (including the provisions of the Occupational Safety and Health Act of 1970 and all amendments thereto, and the DOT Hazardous Materials Regulations), and shall indemnify, defend, and save the Companies harmless from any and all liability, fines, damages, costs, and expenses, including but not limited to reasonable attorneys' fees and costs, arising from Seller’s failure to do so.


30







ARTICLE XIII
RELEASES

Section 13.1: Spills/Environmental Pollution. In the event any spill or discharge occurs from any nominated vessel, vehicle, shipping container, pipeline, or tank utilized by Seller in the performance of this Agreement, or if any spill, discharge, or pollution damage is caused by or is threatened in connection with the loading, transportation, or Delivery of the Product by Seller, then except to the extent such spill, discharge, or pollution damage was caused by the negligence of the Companies or a third party, all regulatory notifications and filings, as well as all efforts and costs of containment and clean up shall be the sole responsibility of Seller.

Section 13.2: Pollution Mitigation.
(A)    Mitigation Measures. When an escape or discharge of oil or any polluting substance occurs in connection with or is caused by Seller’s or its agent’s vessel or occurs from or is caused by discharging operations, Seller or its agents (as the case may be) shall promptly take all measures that are necessary or reasonable to prevent or mitigate environmental damage, without regard to whether or not said escape or discharge was caused by the negligence or willful misconduct of Seller’s equipment, Seller, the Companies, or others. Failing such action by Seller or its agents, the Companies, on Seller’s behalf, may promptly take whatever measures are reasonably necessary to prevent or mitigate pollution damage and notify Seller as soon as practicable thereafter of such actions. Each Party shall, in good faith, keep the other advised of the nature and results of the measures taken, and if time permits, the nature of the measures intended to be taken.

(B)    Prevention and Mitigation Cost. Seller shall be responsible for the cost of all such measures except to the extent the spill, discharge, or pollution damage was the result of the negligence or willful misconduct of the Companies, and prompt reimbursement shall be made as appropriate; provided, however, that should Seller or its agents give notice to the Companies to discontinue said measures (and to the extent Governmental Authorities allow the Companies to discontinue said measures) the continuance of the Companies’ actions will no longer be deemed to have been taken pursuant to the provisions of Sections 13.2(A) (Mitigation Measures) and Section 13.2(B) (Prevention and Mitigation Cost). Each Party in good faith shall provide written notice to the other of such actions and measures taken.

(C)    Third Party Applicability. Notwithstanding any other provision in this Agreement, the foregoing provisions shall be applicable only between Seller and the Companies and shall not affect, as between Seller and the Companies, any liability that either Seller or the Companies shall have to any third parties, including the State of Hawai‘i and the U.S. Government, if either Party shall have such liability.

Section 13.3: Release Liability. Should the Companies incur any liability under Chapter 128D of the Hawai‘i Revised Statutes as a result of a spill from Seller’s nominated vessel during discharge, Seller shall indemnify, defend, and hold the Companies harmless, except to the extent such spill was the result of the negligence or willful misconduct of the Companies.


31





Section 13.4: Operational Contacts. In the event of any accident, spill, or reportable incident incurred under the performance of this Agreement, the following individuals shall be immediately contacted:

HawaiianNamePositionPhoneCellular
Electric
PrimaryGuy Xu-SugaharaFuels Contract Mgr808-543-4043808-384-2337
BackupChie ReyesMgr of Fuels Operations808-543-4007808-225-0957
SELLER
PrimaryMark HepburnVP, Logistics808-203-2341808-304-7806
BackupAndre ThomasPipeline & Terminal Ops Mgr808-547-3842808-479-0591

ARTICLE XIV
INDEMNITY

Section 14.1: Indemnity.
(A)    The Companies agree to defend, protect, indemnify, and save Seller, Seller’s parent corporation, Seller’s affiliates and their respective officers, directors, employees and representatives (the “Seller Group”) harmless from and against any and all claims, demands, liabilities, losses, causes of action, fines, penalties, costs, and expenses (including reasonable attorney’s fees) of every kind and character for personal injury, death, or damage to property, or violations of law, arising from or occurring or growing out of or incident to, or resulting from the willful or negligent acts or omissions of the Companies or their agents, servants, employees, contractors, representatives, and invitees.

(B)    Seller agrees to defend, protect, indemnify, and save the Companies, the Companies’ parent corporation, the Companies’ subsidiary corporations, the Companies’ affiliates and their respective officers, directors, employees, and representatives harmless against any and all claims, demands, liabilities, losses, causes of action, fines, penalties, costs, and expenses (including reasonable attorney’s fees) of every kind and character for personal injury, death or damage to property, or violations of law, arising from or occurring or growing out of or incident to, or resulting from the willful or negligent acts or omissions of Seller or its agents, servants, employees, contractors, representatives, and invitees.

(C)    Where personal injury, death, or loss of or damage to property is the result of the joint negligence or misconduct of a Party hereto, the Parties expressly agree to defend and indemnify each other in proportion to their respective shares of such joint negligence or misconduct.







32



ARTICLE XV
DEFAULT

Section 15.1: Default.
(A)    Default by a Party. Breach by Seller of any of its representations and warranties in this Agreement or failure of either Party to promptly perform any obligation under this Agreement shall constitute an event of default. If, as the non-defaulting Party (“Non-Defaulting Party”), the Companies or Seller, considers the other Party (the “Defaulting Party”) to be in default under this Agreement, the Non-Defaulting Party shall give the Defaulting Party prompt notice thereof, describing the particulars of such default. The [...] shall [...] from the [...] in which to [...]. If the [...] of [...] provided in [...], and [...] provided in this Section 15.1(A) (Default by a Party), the [...] shall [...] to [...] such [...] in the [...] under the [...]. If the [...] as provided herein, the [...] in respect of such [...] its [...] under this Agreement by written notice [...]. Any [...] shall be without [...], including without limitation [...] hereof. All rights and remedies hereunder are independent of each other and election of one remedy shall not exclude another. The [...] in any [...] Section 15.1(A) (Default by a Party) shall be [...] from the [...].

(B)    Default by [...]; [...]. Notwithstanding the foregoing, [...] is a [...] to [...] as required by this Agreement, [...] shall be [...] from [...] issuance of the [...]. Without [...], [...] may [...] from [...], and except as otherwise provided in this Agreement, [...] shall be [...] for the [...] in [...] Seller under this Agreement [...] at the [...], [...] all [...] and [...] and [...] by the [...] in [...] such [...]. By way of example and without limitation,[...], [...], [...].

Section 15.2: Consequential Damages. Except with respect to claims of third parties that give rise to indemnification rights of a Party, in no event shall either Party be liable to the other for any prospective profits, or special, indirect, incidental or consequential damages of any kind,


33




including punitive damages and fees, whether based in contract, tort (including negligence or strict liability), or otherwise.

ARTICLE XVI
NOTICE

Section 16.1 Notices. Except as otherwise expressly provided in this Agreement, all notices shall be given in writing, by Email or first-class mail, to the following addresses, or such other address as the Parties may designate by notice:

Seller's Address:
Par Hawaii Refining, LLC
1132 Bishop Street, Suite 2500
Honolulu, HI 96813
Attn: Eric Wright
Email: EWright@parpacific.com
With a copy to:
Par Hawaii Refining, LLC
91-325 Komohana Street
Kapolei, HI 96707
Attn: Eric Wright
Par Pacific Holdings, Inc.
825 Town & Country Lane, Suite 1500
Houston, TX 77024
Attn: Jeff Hollis
Email: JHollis@parpacific.com
Companies' Address:
Hawaiian Electric Company, Inc.
PO Box 2750
Honolulu, Hawai‘i 96840-0001
Attention: Manager of Fuels Operations – mailstop CIP3-IF
Hawai‘i Electric Light Co., Inc.
P. O. Box 1027
Hilo, Hawaiʻi 96721-1027
Attn: Production Department
Maui Electric Company, Ltd.
P. O. Box 398
Kahului, Hawaiʻi 96732
Attn: Production Department


34




& Hawaiian Electric Company, Inc.
1001 Bishop Street, Suite 1100
Honolulu, Hawai‘i 96813
Attention: Director of Legal Division (AT11-NC)
By Email:legalnotices@hawaiianelectric.com
All notices shall be deemed to have been effectuated upon the earlier to occur of actual receipt or two (2) Days after sending.

ARTICLE XVII
GENERAL PROVISIONS

Section 17.1: Waiver and Severability. If any section or provision of this Agreement or any exhibit or rider hereto is held by any court or other competent authority to be illegal, unenforceable, or invalid, the remaining terms, provisions, rights, and obligations of this Agreement shall not be affected. The failure of a Party hereunder to assert a right or enforce an obligation of the other Party shall not be deemed a waiver of such right or obligation. In no event shall any waiver by either Party of any Default under this Agreement operate as a waiver of any further Default.

Section 17.2: Assignment. This Agreement shall extend to and be binding upon the successors and assigns of the Companies and Seller. Neither Party shall assign this Agreement or its rights and obligations without the prior written consent of the other Party, which shall not unreasonably be withheld, conditioned, or delayed.

Section 17.3: Conflicts of Interest. Conflicts of interest related to this Agreement are strictly prohibited. Except as otherwise expressly provided herein, no Party, nor any director, employee, or agent of a Party shall give to or receive from any director, employee, or agent of the other Party any gift, entertainment, or other favor of significant value, or any commission, fee, or rebate. Likewise, no Party nor any director, employee, or agent of a Party shall enter into any business arrangement with any director, employee, or agent of the other Party (or any affiliate), unless such person is acting for and on behalf of the other Party.

Section 17.4: Governing Law, Jurisdiction, and Venue. This Agreement shall be governed by and construed in accordance with the laws of the State of Hawai‘i, without regard to choice of law principles. Any disputes arising out of this Agreement, however defined, shall be brought exclusively in a court of competent jurisdiction in the State of Hawai‘i. Each Party agrees and irrevocably consents to the exercise of personal jurisdiction by such courts and waives any right to plead, claim, or allege that the State of Hawai‘i is an inconvenient forum or improper venue.
Each Party hereby irrevocably and unconditionally waives it right to a trial by jury in any legal action or proceeding relating to, arising out of, or in connection with this Agreement.

Section 17.5: Entire Agreement/Modification. This Agreement, including all attachments and exhibits hereto, shall constitute the entire understanding and agreement between the Parties with


35




respect to all matters and things herein mentioned, superseding all prior agreements, understandings, or undertakings, oral or written. It is expressly acknowledged and agreed by and between the Parties that neither Party is now relying upon any collateral, prior, or contemporaneous agreement, assurance, representation, statement, or warranty, written or oral, pertaining to the subject matter contained herein. This Agreement shall not be modified or changed except by written instrument executed by the duly authorized representatives of the Parties hereto.

Section 17.6: Agreement Is Not an Asset: Insolvency. This Agreement shall not be deemed to be an asset of either Party. If a Party is (i) dissolved, liquidated, adjudicated as bankrupt, or becomes subject to an order for relief under any federal bankruptcy law; (ii) fails to pay or admits in writing its inability to pay its debts generally as they become due; (iii) makes a general assignment of substantially all of its assets for the benefit of creditors; (iv) applies for, seeks, consents to, or acquiesces in the appointment of a receiver, custodian trustee, examiner, liquidator, or similar official for itself or any substantial part of its property; (v) institutes any proceedings seeking an order for relief or to adjudicate it as bankrupt or insolvent, or seeking dissolution, winding up, liquidation, reorganization, arrangement, adjustment, or composition of it or its debts under any law relating to bankruptcy, insolvency, reorganization or relief of debtors; or (vi) takes any action to authorize or effect any of the foregoing actions, that Party shall be in default pursuant to Section 15.1 (Default). If such Defaulting Party fails to cure such Default pursuant to the requirements of Section 15.1 (Default), the Non-Defaulting Party may terminate this Agreement according to Section 15.1 (Default).

Section 17.7: Status of the Parties. Nothing in this Agreement shall be construed to constitute either Party as a joint venturer, co-venturer, joint lessor, joint operator, agent, or partner of the other or to create any fiduciary relationship between the Parties. In performing services pursuant to this Agreement, Seller is acting solely as an independent contractor maintaining complete control over its employees and operations. Unless otherwise provided in this Agreement, neither the Companies nor Seller is authorized to take any action in any way whatsoever for or on behalf of the other.

Section 17.8: Headings. The headings or captions are for convenient reference only and shall not modify, define, or limit any of the terms or provisions hereof and shall not be used in the interpretation of any term or provision of this Agreement.

Section 17.9: Confidentiality and Non-Disclosure.
(A)    Confidential Information. Each Party may have a proprietary interest or other need for confidentiality in information that may be furnished to the other pursuant to this Agreement (“Confidential Information”). The Party disclosing such information shall be referred to in this section as the “Disclosing Party”, and the Party receiving such information shall be referred to as the “Receiving Party”.

(B)    The Receiving Party will hold in confidence and, without the consent of the Disclosing Party, will not use, reproduce, distribute, transmit, or disclose, directly or indirectly, the Confidential Information of the Disclosing Party except as permitted herein. The Receiving Party may only disclose the Confidential Information to its officers, directors, employees,


36




professional advisors, and independent contractors and consultants with a direct need to know the information for the implementation or exercise of rights and/or performance of obligations under or arising from this Agreement, provided that such persons/entities (other than officers, directors, and employees) are bound by written confidentiality agreements with terms and conditions that are no less restrictive than those contained in this section. Without limiting the foregoing, the Receiving Party agrees that it will exercise at least the same standard of care in protecting the confidentiality of the Disclosing Party’s Confidential Information as it does with its own Confidential Information of a similar nature, but in any event, no less than reasonable care.

(C)    Confidential Information for purposes of this Agreement shall not include information if and only to the extent that the Receiving Party establishes that the information: (i) is or becomes a part of the public domain through no act or omission of the Receiving Party; (ii) was in the Receiving Party’s lawful possession prior to the disclosure and had not been obtained by the Receiving Party either directly or indirectly from the Disclosing Party; or (iii) is lawfully disclosed to the Receiving Party by a third party without, to a Receiving Party’s knowledge, restriction on disclosure. Confidential Information may also be disclosed by the Receiving Party pursuant to a requirement of a governmental agency, regulatory body or by operation of law, provided that the recipient shall disclose only that part of the Confidential Information that it is required to disclose and shall notify the Disclosing Party prior to such disclosure in a timely fashion in order to permit the Disclosing Party to, at its cost, lawfully attempt to prevent or restrict such disclosure should it so elect, and shall take all other reasonable and lawful measures to ensure the continued confidential treatment of the same by the party to which the Confidential Information is disclosed.

(D)    Any provision herein to the contrary notwithstanding, the Companies may disclose Confidential Information to the Commission, the Division of Consumer Advocacy of the Department of Commerce and Consumer Affairs of the State of Hawai‘i (“Consumer Advocate”), and/or any other governmental regulatory agency with notice to, but without need of prior consent by Seller, provided that the Companies take reasonable steps to obtain approval to submit the same under seal or under other procedures designed to preserve the confidentiality of the Confidential Information.

(E)    The Parties acknowledge and agree that this Agreement will be submitted to the Commission for approval as provided in Section 2.2 (Regulatory Approval). In consideration of the foregoing and consistent with past practice, except as otherwise agreed upon by the Parties, this Agreement does not constitute Confidential Information.

Section 17.10 Financial Compliance; No Consolidation:
(A)    Financial Compliance. Upon request, each Party shall provide or cause to be provided to the other Party as soon as reasonably practicable, all information, including but not limited to information that may be obtained in any audit referred to below (“Information”), reasonably requested by such Party for purposes of permitting the Companies and its parent company, Hawaiian Electric Industries (“HEI”), or Par Hawaii Refining, LLC and its parent company, as applicable, to comply with the requirements (initial and on-going) of (i) identifying variable interest entities and determining primary beneficiaries under the accounting principles


37




of Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 810, Consolidation (“FASB ASC 810”), (ii) Section 404 of the Sarbanes-Oxley Act of 2002 (“SOX 404”), (iii) FASB ASC 842 Leases (“FASB ASC 842”), and (iv) all clarifications, interpretations and revisions of and regulations implementing FASB ASC 810, SOX 404, and FASB ASC 842, Securities and Exchange Commission, the Public Company Accounting Oversight Board, Emerging Issues Task Force or other governing agencies. In addition, if required by a Party in order to meet its compliance obligations, the other Party shall allow such Party or its independent auditor, to audit to the extent reasonably required, its financial records, including its system of internal controls over financial reporting; provided that the Party requesting such audit shall be responsible for all reasonable and documented costs associated with the foregoing.

(B)    If there is a change in circumstances during the Initial Term, or any Extension that would trigger consolidation of a Party’s finances on to the other Party’s balance sheet, then the Parties will promptly confer and shall take all commercially reasonable steps, including if necessary modification of the Agreement, to eliminate the consolidation, while preserving the economic “benefit of the bargain” to both Parties.


(C)    Confidentiality. The Companies shall, and shall cause HEI to, maintain the confidentiality of the Information as provided in Section 17.10 (Financial Compliance; No Consolidation). The Companies may share the Information on a confidential basis with HEI and the independent auditors and attorneys for the Companies and HEI (the Companies, HEI, and their respective independent auditors and attorneys are collectively referred to in Section 17.10 (Financial Compliance; No Consolidation) as “Recipient.”) If either the Companies or HEI, in the exercise of their respective reasonable judgments, concludes that consolidation or financial reporting with respect to Seller and/or this Agreement is necessary, the Companies and HEI each shall have the right to, following at least thirty (30) Days advance written notice to Seller, disclose such of the Information as the Companies or HEI, as applicable, reasonably determines is necessary to satisfy applicable disclosure and reporting or other requirements and give Seller prompt written notice thereof (in advance to the extent practicable under the circumstances). If the Companies or HEI disclose Information pursuant to the preceding sentence, the Companies and HEI shall, without limitation to the generality of the preceding sentence, have the right to disclose Information to the Commission and the Consumer Advocate in connection with the Commission’s rate making activities for the Companies and other HEI affiliated entities, provided that, if the scope or content of the Information to be disclosed to the Commission exceeds or is more detailed than that disclosed pursuant to the preceding sentence, such Information will not be disclosed until the Commission first issues a protective order to protect the confidentiality of such Information. Neither the Companies nor HEI shall use the Information for any purpose other than as permitted under Section 17.10 (Financial Compliance; No Consolidation).

(D)    Required Disclosure. In circumstances other than those addressed in Section 17.10(C) (Confidentiality), if any Recipient becomes legally compelled under applicable Law or by legal process (e.g., deposition, interrogatory, request for documents, subpoena, civil investigative demand or similar process) to disclose all or a portion of the Confidential


38




Information, such Recipient shall undertake reasonable efforts to provide Seller with prompt notice of such legal requirement prior to disclosure so that Seller may seek a protective order or other appropriate remedy and/or waive compliance with the terms of Section 17.10 (Financial Compliance; No Consolidation), and such Recipient shall cooperate to a reasonable extent with Seller to seek such protective order or other appropriate remedy at Seller’s sole cost and expense. If such protective order or other remedy is not obtained, or if Seller waives compliance with the provisions of Section 17.10 (Financial Compliance; No Consolidation), Recipient shall furnish only that portion of the Information which it is legally required to so furnish and shall use reasonable efforts to obtain assurance that confidential treatment will be accorded to any disclosed material.

(E)    Exclusions from Confidentiality. The obligation of nondisclosure and restricted use imposed on each Recipient under Section 17.10 (Financial Compliance; No Consolidation) shall not extend to any portion(s) of the Information which (i) was known to such Recipient prior to receipt, or (ii) without the fault of such Recipient is available or becomes available to the general public, or (iii) is received by such Recipient from a third party not bound by an obligation or duty of confidentiality.

(F)    Consolidation. Neither Party wants to be subject to consolidation in FASB ASC 810, as issued and amended from time to time by FASB. The Companies represent that, as of the Execution Date, they are not required to consolidate Seller into the Companies’ financial statements in accordance with relevant accounting guidance under U.S. generally accepted accounting principles (“GAAP”). If, due to a change in applicable Law or accounting guidance under GAAP, or as a result of a material amendment to the Agreement, in each case, after the Execution Date, the Companies determine, in their sole but good faith discretion following reasonable consultation with Seller and its authorized representatives, that the Companies are required to consolidate Seller into the Companies’ financial statements in accordance with relevant accounting guidance in accordance with GAAP, then Seller shall, as soon as reasonably practicable, use commercially reasonable efforts in order for the Companies to consolidate and file their financial statements within the reporting deadlines of the Securities and Exchange Commission; provided, however, that if Seller does not normally prepare audited financial statements for the periods requested, the Companies shall reimburse Seller the reasonable and documented costs of having necessary audits performed and preparation of the audited financial statement; provided, further that the foregoing reimbursement shall only apply if Seller normally prepares financial statements on an annual basis. Notwithstanding the foregoing requirement that Seller provide audited financial statements to the Companies, the Parties will take all commercially reasonable steps, which may include modification of this Agreement to eliminate the potential for consolidation treatment, while preserving the economic “benefit of the bargain” to both Parties.


Section 17.11: No Dedication of Facilities. No use of the pipelines, facilities, or equipment used in connection with this Agreement shall be construed as having been dedicated to public use and it is hereby acknowledged by the Parties that the owner of any pipelines used to transport the Product under this Agreement retains the rights to determine who, other than the Parties to this Agreement, shall use said pipelines, facilities, and equipment.


39





Section 17.12: Cessation of Crude Distillation Operations: If, at any time during the Initial Term or any Extension, Seller intends to cease crude distillation operations at its Par East facility, then Seller shall provide the Companies with [...] prior written notice of its intention to terminate this Agreement in connection with its cessation of crude distillation operations. Upon effectuation of such notice to terminate, either Party may call for renegotiation of this Agreement to address such circumstances. The Parties shall enter into renegotiations within [...] after the notice to renegotiate is effectuated. If the Parties have not reached a mutually satisfactory resolution within [...] after the notice to renegotiate is effectuated, then either Party may terminate this Agreement.

Section 17.13: Attorneys’ Fees. If there is a dispute between the Parties and either Party institutes a lawsuit, arbitration, mediation, or other proceeding to enforce, declare, or interpret the terms of this Agreement, the prevailing Party shall be awarded its reasonable, documented outside attorneys’ fees and costs.

Section 17.14: Offsets. In the event that a Party owes the other Party (“Offsetting Party”) any amount under this Agreement, the Offsetting Party owed such amount may at any time offset any and all amounts that are due and owed to the other Party against such amount that the other Party owes the Offsetting Party. The Offsetting Party asserting an offset shall provide a prompt written explanation of the amount and the basis for the offset.

Section 17.15: Further Assurances. If either Party determines that any further instruments, assurances, or other things are necessary or desirable to carry out the terms of this Agreement, the other Party will execute and deliver all such instruments and assurance and do all things reasonably necessary or desirable to carry out the terms of this Agreement.

Section 17.16: Promotional Limitation. Each Party agrees that it will not, without written authorization of the other Party, use the other Party’s name for the purpose of promotion, including, without limitation, references in press releases, lists of customers, or other material advertising.

Section 17.17: Patents and Copyrights. Each Party agrees that, in performing its obligations pursuant to this Agreement, it will not use any process, program, design, device, or material that infringes on any third party United States patent or copyright or any trade secret agreement.
Each Party agrees to indemnify, defend, and hold harmless the other Party from and against all losses damages, claims, fees, and costs (including, without limitation, reasonable attorneys’ fees and costs) arising from or incidental to any third party suit or proceeding for patent, copyright, or trade secret infringement relating to the other Party’s performance hereunder. Each Party shall promptly notify the other Party of any such suit or proceeding and shall assist the other Party in defending the action by providing any necessary information at the indemnifying Party’s cost.

Section 17.18: Cumulative Remedies. No rights or remedies herein conferred upon or reserved to either Party are intended to be exclusive of any other right or remedy, and each and every right and remedy shall be cumulative and in addition to any other right or remedy under this Agreement or under applicable Law.


40





Section 17.19: Amendments. Any amendment or modification of this Agreement shall not be valid unless in writing and signed by both Parties. Any waiver of rights shall not be valid unless in writing and signed by the Party against whom waiver is asserted.

Section 17.20: Negotiated Terms. The Parties agree that the terms and conditions of this Agreement are the result of negotiations between the Parties and that this Agreement shall not be construed in favor of or against either Party by reason of the extent to which any Party or its professional advisors participated in the preparation of the Agreement.

Section 17.21: Relationship of the Parties. Seller shall act solely as an independent contractor of the Companies. Nothing in this Agreement shall be deemed to designate either Party hereto as partner, agent, or representative of the other Party or to create any fiduciary relationship between the Parties. All employees of Seller will work under the supervision of Seller and not act as the Companies’ agents or servants for any purpose.

Section 17.22: No Third-Party Beneficiaries. Nothing expressed or referred to in this Agreement will be construed to give any person or entity other than the Parties any legal or equitable right, remedy, or claim under or with respect to this Agreement or any provision hereof. This Agreement and all of its provisions and conditions are for the sole and exclusive benefit of the Parties and their successors and permitted assigns.

Section 17.23: Counterparts. This Agreement and any subsequent writings, including amendments, may be executed in as many counterparts as desired by the Parties, any one of which shall have the force and effect of any original but all of which together shall constitute the same instrument. Duplicate, unexecuted, and acknowledged pages of the counterparts may be discarded, and the remaining pages assembled as one document. This Agreement and any subsequent writings, included amendments, may also be executed by exchange of executed copies via electronic means, such as PDF, in which case – but not as a condition to the validity of the Agreement – each Party shall subsequently, upon request, send the other Party by mail the original executed copy. A Party's signature transmitted by facsimile or similar electronic means shall be considered an “original” signature that is binding and effective for purposes of this Agreement.


41



IN WITNESS WHEREOF, the Parties hereto have executed this Agreement on the day and year first above written.

HAWAIIAN ELECTRIC COMPANY, INC.
By/s/ Robert Isler
Its:VP, Power Supply
By/s/ Shelee Kimura
Its:President & CEO
HAWAII ELECTRIC LIGHT COMPANY, INC.
By/s/ Robert Isler
Its:Vice President
By/s/ Shelee Kimura
Its:Chairman & President
MAUI ELECTRIC CO., LTD.
By/s/ Robert Isler
Its:Vice President
By/s/ Shelee Kimura
Its:Chairman & President
PAR HAWAII REFINING, LLC
By/s/ Eric Wright
Its:President


42



EXHIBIT A
(Product Specifications)

1.    Low Sulfur Fuel oil (LSFO) Specifications

The LSFO to be supplied hereunder shall comply with the following specifications:

LSFO
Contract Specifications
Test Property
Test Method
Unit Of Measure
Min
Max
API Gravity @ 60°
ASTM D4052
°API
12
[...]
Viscosity
ASTM D445, D2161
CST @ 210 °F
[...]
96
Heat Value, Gross
ASTM D240
MM BTU/BBL
6.02
Flash Point
ASTM D93
°F
150
Pour Point
ASTM D97, D5949,
D5950
°F
[...]
Ash
ASTM D482
Percent, Weight
0.03
Sediment & Water
ASTM D1796
Percent, Volume
  [...]1
Sulfur
ASTM D4294
Percent, Weight
0.50
Nitrogen
ASTM D4629, D5762
Percent, Weight
0.50
Vanadium
ASTM D5863, D6728
PPM, Weight
50.0
Carbon Residue
ASTM D4530
Percent, Weight
[...]

1    [...]
2    [...]


43




2.    High Sulfur Fuel oil (HSFO) Specifications

The HSFO to be supplied hereunder shall be a regular commercial grade of Industrial Fuel Oil No. 6 and shall comply with the following specifications:

HSFO
Contract Specifications
Test Property
Test Method
Unit Of Measure
Min
Max
API Gravity @ 60°F
ASTMD1298, D4052
°API
6.5
Viscosity
ASTM D445, D2161
CST @ 122 °F
380
480
Heat Value, Gross
ASTM D240, D4868
MM BTU/BBL
6.0
Flash Point
ASTM D93, D6450
°F
150
Pour Point
ASTM D97, D5950
°F
55
Sediment & Water
ASTM D1796
Percent, Volume
0.5
Sulfur
ASTM D1552, D2622,
D4294
Percent, Weight
2.00
Nitrogen
ASTM D4629, D5762
PPM, Weight
  [...]
Vanadium
ASTM D5863, D6728
PPM, Weight
  [...]

HSFO Confirmation Tests: API Gravity @ 60°F, Viscosity, Heat Value (Gross), Flash Point and Sulfur


44





3.    Diesel Specifications

All Diesel received from Par West will continue to be coalesced. The Diesel to be supplied hereunder shall be a regular commercial grade of Diesel Fuel No. 2 and shall comply with the following specifications:

HSD
Contract Specifications
Test Property
Test Method
Unit Of Measure
Min
Max
API Gravity @ 60°F
ASTMD1298, D4052
°API
30
Viscosity
ASTM D445, D2161
CST @ 40°C
1.9
4.1
Heat Value, Gross
ASTM D240, D4868
MM BTU/BBL
  [...]
Flash Point
ASTM D93, D6450
°F
150
Pour Point
ASTM D97, D5949,
D5950
°F
  [...]
Ash
ASTM D482
PPM, Weight
100
Cetane Index
ASTM D4737
Number
40
Carbon Residue
D524, D4530
Percent, Weight
0.35
Distillation 90%
ASTM D86
°F
540
       [...]
Sediment & Water
ASTM D1796, D2709
Percent, Volume
0.05
Sulfur
ASTM D129, D2622,
D4294
Percent, Weight
0.40
Nitrogen
ASTM D4629, D5762
PPM, Weight
150
Sodium + Potassium
ASTM D3605, D6728
PPM, Weight
0.5
Sodium + Potassium +
Lithium
ASTM D3605, D6728
PPM, Weight
Report
Vanadium
ASTM D-5863, D6728
PPM, Weight
  [...]

Diesel Confirmation Tests: API Gravity @ 60°F, Heat Value (Gross), Flash Point, Cetane Index, Sulfur, Nitrogen, Sodium, Potassium, and Red Dye Content


45




4.    Ultra-Low Sulfur Diesel (ULSD) Specifications

The ULSD to be supplied hereunder shall be a regular commercial grade of ULSD and shall comply with the following specifications:

ULSD
Contract Specifications
Test Property
Test Method
Unit Of Measure
Min
Max
Appearance
ASTM 4176
Number
2
API Gravity @ 60°F
ASTMD1298, D4052
°API
Report
Viscosity
ASTM D445, D2161
CST @ 40°C
1.9
4.1
Heat Value, Gross
ASTM D240, D4868
MM BTU/BBL
Report
Flash Point
ASTM D93, D6450
°F
[...]
Ash
ASTM D482
PPM wt
100
Cetane Index
ASTM D4737
Number
40
Carbon Residue
D524, D4530
Percent, Weight
0.35
Distillation 90%
ASTM D86
°C
282
338
Sediment & Water
ASTM D1796, D2709
Percent, Volume
0.05
Sulfur
ASTM D5453, D7039
PPM, Weight
15
Copper Strip Corrosion:
3HR @ 50°C
ASTM D4629, D5762
Classification
3
Lubricity, 60 °C, WSD
ASTM D6079
Microns
520
Conductivity
ASTM D2624, D4308
pS/m
25

ULSD Confirmation Tests: API Gravity @ 60°F, Heat Value (Gross), Flash Point, Cetane Index, and Sulfur


46



EXHIBIT B
(Pricing)

1.    [...] Pricing

A.    [...] Pricing.

For the [...], the price of [...] to meet the [...] shall be determined [...] as follows:

[...]

[...]

[...]
[...]:

[...]

[...]

[...]

[...]

[...]1
[...]1
[...]


47




1 [...]

[...]

B.    [...]

[...]

[...]


C.    [...]
[...]


48




2.    [...] Pricing

The price of [...] shall be determined Monthly as follows:

[...]

[...]:

[...]

[...]




[...]




[...]






[...]:



[...]

* [...]


49





[...]
[...]*
[...]
[...]*
[...]
[...]*
[...]
[...]
[...]
[...]
[...]
[...]


[...]


50




3.    [...] Pricing

The price of [...] shall be [...] as follows:

[...]

[...]:

[...]

[...]





[...]:




[...]








[...]:


[...]

* [...]




[...]     [...]*


51





[...]
[...]*
[...]
[...]*
[...]
[...]
[...]
[...]
[...]
[...]
[...]
[...]
[...]
[...]
[...]
[...]



[...]
----------------------------
1 [...]
2 [...]

.


52




4.    [...] Pricing

[...]

[...]:

[...]

[...]





[...]





[...]





[...]


5.    [...]

[...]


53



Exhibit C
(Use of [...] and [...])

1.    [...] plus [...] applies to [...] that is [...] through [...].

2.    The [...] dated [...] applies to [...] that is [...] from [...].


3.    [...] plus [...], [...] with a [...] plus [...], applies to [...] that is [...] or from [...]. The [...] provided [...] is effectuated.




4.    If [...] is [...] to [...] and has a [...], then [...].

54

HEI Exhibit 10.2
REGULATORY CAPITAL MAINTENANCE/DIVIDEND
AGREEMENT

This Agreement is made this 26th day of May, 1988, by and between Hawaiian Electric Industries, Inc. (“HEI") and HEI Diversified, Inc. (“HED”) (the “Acquiror”) and the Federal Savings and Loan Insurance Corporation (“FSLIC”), a corporate instrumentality and agency of the United States, which is under the operating direction of the Federal Home Loan Bank Board (the “Board”).
WHEREAS, the Acquiror has filed the appropriate applications (“Applications”) with the FSLIC for approval of its acquisition of American Savings Bank, F.S.B. (the “Institution”);
WHEREAS, in reviewing the Application(s), the FSLIC must make a determination that the financial and managerial resources and future prospects of the Acquiror and the Institution are not detrimental to the Institution or the insurance risk of the FSLIC;
WHEREAS, in order to assure that the financial resources and future prospects of the Acquiror and the Institution are such that the acquisition would not be detrimental to the Institution or the insurance risk of the FSLIC and in order to assure that the Acquiror would serve as a source of financial strength to the Institution, the FSLIC requires that the Acquiror agree to maintain the Institution’s regulatory capital at regulatory required levels; and
WHEREAS, the Acquiror is willing to make such commitment in order that the FSLIC will approve the acquisition;
NOW, THEREFORE, in consideration of the FSLIC approving the acquisition of control of the Institution by the Acquiror, the Acquiror agrees as follows:
I.Definitions
The following terms used in this Agreement shall have the following meanings:
A.“Control” means conclusive control or rebuttable control as set forth in 12 C.F.R. § 574.4 (a) and (b).
B.“Date of Acquisition” means the effective date on which the Acquiror acquired control of the Institution.

-2-
C.“Default” means the failure of the Acquiror to comply with its obligations under Section II. or III. of this Agreement or the breach of any representation or warranty set forth in Section III. of this Agreement.
D.“Regulatory Capital” means regulatory capital defined in accordance with 12 C.F.R. § 561.13 or any successor regulation thereto.
E.“Regulatory Capital Requirement” means the Institution’s regulatory capital requirement at a given time computed in accordance with 12 C.F.R. § 561.13, or any successor regulation thereto.
F.“Regulatory Capital Deficiency” means the amount by which the regulatory capital of the Institution, computed in accordance with 12 C.F.R. § 561.13, is less than the Institution’s Regulatory Capital Requirement.
G.“Shares” means all shares of the stock of the Institution that have been acquired by the Acquiror; any securities convertible into any such shares; any options, warrants or other rights for the acquisition of any such shares; and all such shares, securities, options, warrants or rights that may otherwise be issued to or acquired by the Acquiror, whether before or after the Date of Acquisition, together with the certificates or other instruments or agreements evidencing those shares, securities, options, warrants or rights.
H.“Supervisory Agent” means the Supervisory Agent at the Federal Home Loan Bank of Seattle.
II.OBLIGATIONS OF ACQUIROR
The Acquiror shall maintain the Institution's Regulatory Capital in compliance with the Regulatory Capital Requirement and the limitations imposed by section IV. of this Agreement, as follows:
A.As long as the Acquiror controls the Institution, the Acquiror will cause the Regulatory Capital of the Institution to be maintained at a level equal to the greater of 6% of total liabilities or the amount required under Section 563.13 as currently in existence or as hereafter amended, and, as necessary infuse additional capital in a form satisfactory to the Supervisory Agent. Provided, however, that additional capital infusion shall be limited to an aggregate amount not to exceed 6% of total

-3-
liabilities as of the close of the calendar quarter preceding the date of acquisition of the Institution by the Acquiror, such dollar amount to be confirmed with the Supervisory Agent within 30 days following the date of acquisition.
B.That unless prior written approval is obtained from the Supervisory Agent, dividends paid by the Institution to the Acquiror in any fiscal year on a cumulative basis shall be limited as follows:
1.an amount up to 50% of net income for that fiscal year so long as the Institution maintains its capital requirement at a level equal to the greater of (a) the amount consistent with that required by Section 563.13 as currently in existence or hereafter amended, or (b) 6% of total liabilities.
2.an amount up to 75% of net income for that fiscal year if Regulatory Capital is at a level equal to the greater of (a) the amount consistent with that required by Section 563.13 as currently in existence or hereafter amended, plus 100 basis points, or (b) 7% of total liabilities, and
3.an amount up to 90% of net income for that fiscal year if capital is at a level equal to the greater of (a) the amount consistent with that required by Section 563. 13 as currently in existence or hereafter amended, plus 200 basis points, or (b) 8% of total liabilities.
It is further provided that any dividends may be deferred and paid in a subsequent year, but no dividends shall be paid which would cause the Institution to fail its Regulatory Capital Requirement.
III.REPRESENTATIONS, COVENANTS AND WARRANTIES OF THE ACQUIROR
Acquiror represents, covenants and warrants to FSLIC that:
A.The information given to the FSLIC by the Acquiror and relied on thereby in connection with the acquisition of control of the Institution is true, accurate, complete and current in all material respects;
B.Without the prior written approval of the Supervisory Agent, the Acquiror shall not convey by gift, sale, exchange or otherwise or take any action to effect

-4-
a transfer of any of the Shares subsequent to receipt of a notice of default as provided under Section V. of this Agreement or after the Acquiror knows or should have known of the existence of an imminent occurrence of a Default; provided, however, that the foregoing shall not prohibit or restrict a conveyance or transfer made pursuant to a binding obligation existing prior to the receipt of such notice of Default or prior to such time after which the Acquiror knew or should have known of the existence of a Default.
A.As of the date of this Agreement, the Shares are free and clear of all liens, security interests and charges.
IV.DIVIDENDS
Prior to the occurrence of a Default and after any Default that may have occurred and has been expressly cured or waived in writing, the Acquiror shall be entitled to receive all cash dividends and other cash distributions made in connection with the Shares, provided that such payment or distribution is not prohibited or otherwise limited by statute or regulation, including 12 C. F. R. § 563b.3(g) (2) and (3), or by any agreement entered into by the Institution with the FSLIC or its delegates, and provided further that receipt of such dividends is permissible under Section II.B. of this Agreement.
V.DEFAULTS
A.If the FSLIC shall determine that a Default has occurred, it shall give notice of such Default to the Acquiror and to the Institution and afford the Acquiror an opportunity to cure such a Default as follows:
1.If the Default arises under Section II.A of this Agreement, the Acquiror shall infuse into the Institution additional capital in a form satisfactory to the Supervisory Agent, in an amount equal to 100 percent of the Regulatory Capital Deficiency.
2.If the Default arises under Section II.B. or III. of this Agreement, the Acquiror shall correct the situation giving rise to the Default.
B.If such Default is not cured within ninety (90) days or waived in the manner provided herein, the FSLIC may exercise any right, or exercise or seek any remedy that is available in law or equity, or by statute or regulation,

-5-
including but not limited to specific performance and administrative or judicial enforcement proceedings. No failure or delay on the part of the FSLIC in the exercise of any right or remedy shall operate as a waiver thereof, nor shall any partial exercise of any right or remedy preclude other or further exercise of any other right or remedy. The Acquiror shall pay any attorney fees and other reasonable expenses incurred by the FSLIC in exercising its rights or seeking any remedies hereunder.
B.The FSLIC, in its sole discretion, may waive any past Default hereunder and its consequences, before or after the giving of the notice of Default in the manner provided above, by delivering notice of such waiver in writing to the Acquiror, but no such waiver shall extend to any Default that occurs subsequent to the date of such waiver, and no waiver or purported waiver that is not in writing shall be effective.
C.The Acquiror hereby agrees to execute and deliver any documents and to take such other actions as the FSLIC may request in order for the FSLIC to exercise its rights under this Agreement. The foregoing will in no way limit the Acquiror’s right to seek judicial relief in connection with a matter related to, or arising under, this Agreement.
VI.MISCELLANEOUS PROVISIONS
A.Any notice hereunder shall be in writing and shall be delivered by hand or sent by United States mail or commercial express mail, postage prepaid, and addressed as follows:
If to the Acquiror: Hawaiian Electric Industries, Inc.
HEI Diversified, Inc.
900 Richards Street
Honolulu, Hawaii 96813
If to the FSLIC:Principal Supervisory Agent
Federal Home Loan Bank
of Seattle
If to the Institution:American Savings Bank, F.S.B.
Financial Plaza of the Pacific
Honolulu, Hawaii 96813

B.This Agreement shall be deemed a contract made under and governed by Federal law.

-6-
C.This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.
D.All references to regulations of the Board or the FSLIC used in this Agreement shall include any successor regulation thereto, it being expressly understood that subsequent amendments to such regulations may be made and that such amendments may increase or decrease the Acquiror’s obligation under this Agreement.
E.No supplement, modification or amendment of this Agreement shall be binding unless executed in writing by both of the parties.
F.This Agreement has been duly authorized, executed, and delivered, and constitutes, in accordance with its terms, a valid and binding obligation of the Acquiror and the FSLIC. It is understood and agreed that this Agreement is a “written agreement entered into with the Corporation” as that phrase is used in Section 407(e) of the National Housing Act (“NHA”), 12 U.S.C. § 1730(e) (1982).
G.The Supervisory Agent has the authority to act on behalf of the FSLIC in granting approvals or waivers, giving notices of default, or taking any other action provided for in this Agreement.
H.This Agreement shall be effective as of the Date of the Acquisition.
VII.TERMINATION OF AGREEMENT
Unless otherwise terminated or extended by the mutual consent of the parties hereto, the Acquiror’s obligations under this Agreement shall terminate: (1) as a result of a transfer of all the Acquiror Shares which has received all applicable regulatory approvals, if any, or, (2) upon a finding by the FSLIC that the Acquiror’s control of the Institution has been terminated; provided that the Acquiror furnishes written notice of such transfer specifically indicating that the Acquiror assents that this Agreement is terminated thereby, at the time the Acquiror transfers the Shares and provided further that the FSLIC agrees that such transfer terminates the Acquiror’s control of the Institution within the meaning of Section 408(e) of the NHA, 12 U.S.C. § 1730a (e), and 12 C.F.R. Part 574. Termination of this Agreement shall not preclude the exercise by the FSLIC of any right or remedy hereunder which arose out of a Default that occurred or existed prior

-7-

prior to such termination and in respect to which notice of such Default has been given pursuant to section V. hereof on or before the ninetieth (90th) day following such termination.

IN WITNESS WHEREOF, the parties have executed this Agreement by their duly authorized officer or designated agent on this 26th day of May, 1988.
HEI Diversified, Inc.
Hawaiian Electric Industries, Inc.
By: /s/ Robert F. Clarke
FEDERAL SAVINGS AND LOAN
INSURANCE CORPORATION
By: /s/ Ronald N. Karr
Supervisory Agent
Federal Home Loan Bank of Seattle

HEI Exhibit 10.3

[OTS letterhead]
December 23, 1992


Wayne Minami, President
American Savings Bank, FSB
Financial Plaza of the Pacific
915 Fort Street Mall
Honolulu, Hawaii 96813

OTS No. 8384

Dear Mr. Minami:
We have reviewed your request, pursuant to 12 C.F.R. Section 563.134(e)(3), to be released from Part II.B. of the Regulatory Capital Maintenance/Dividend Agreement, dated May 26, 1988, between the institution, its parent companies, and the Federal Home Loan Bank Board.
Insofar as the provisions of the above agreement impose more stringent restrictions on the payment of dividends than 12 C.F.R. Section 563.134 and it has been determined there is currently no supervisory basis to impose stricter requirements on American and its parent companies with respect to capital distributions than that contained in Section 563.134, American Savings and its parent companies are hereby released from Part II.B., only, of the Regulatory Capital Maintenance/Dividend Agreement. All other provisions of the agreement shall remain in full force and effect.
Accordingly, effective this date, American Savings shall be subject only to the capital distribution limitations for its applicable tier designation at any given time, including the prior notification requirements, set forth in 12 C.F.R. Section 563.134 as currently in effect or as may be subsequently amended.
Sincerely,
/s/ Duane Thorkildsen
Duane Thorkildsen
Assistant Regional Director

PDM
cc: Paul Jennison, Assistant Regional Director
San Francisco Regional Office, FDIC

Hawaiian Electric Exhibit 10.4

CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) IS THE TYPE OF INFORMATION THAT HAWAIIAN ELECTRIC COMPANY, INC. TREATS AS PRIVATE OR CONFIDENTIAL.

SECOND AMENDMENT TO SUPPLY CONTRACT FOR PETROLEUM FUELS

This Second Amendment to Supply Contract for Low Sulfur Fuel Oil (“LSFO”), High Sulfur Fuel Oil (“HSFO”), No. 2 Diesel (“Diesel”), and Ultra-Low Sulfur Diesel (“ULSD”) (this “Amendment”) is dated as of February 1, 2022 (the “Effective Date”), by and between Hawaiian Electric Co., Inc. (“Hawaii Electric”), Hawaii Electric Light Company, Inc. (“Hawaii Electric Light”), and Maui Electric Company, Limited. (“Maui Electric”) (collectively, the “Companies” or “Buyer”) and Par Hawaii Refining, LLC (“Seller”). Buyer and Seller are each a “Party” and collectively are the “Parties.” Capitalized terms used herein but not defined shall have the meaning set forth in the Existing Contract (as hereinafter defined).

RECITALS:

A.WHEREAS, Buyer and Seller entered into that certain Supply Contact for Petroleum Fuels dated January 21, 2019 (as amended June 9, 2020, the “Existing Contract”) for the supply of LSFO, HSFO, Diesel, and/or ULSD from Seller to the Companies;

B.WHEREAS, on February 1, 2022, the Parties entered into that certain Supply Agreement for Petroleum Fuels (the “New Supply Contract”) that is conditioned upon receipt of a Non-Appealable Commission Approval Order (as hereinafter defined) by no later than December 2, 2022 and, if such Non-Appealable Commission Approval Order is timely received, will become effective on January 1, 2023.

C.WHEREAS, the Parties each agree to modify the terms of the Existing Contract upon the terms set forth herein.

NOW, THEREFORE, in consideration of the mutual covenants and promises contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereby agree as follows:

AGREEMENT:


1.Recitals. The recitals are hereby incorporated herein.

2.Definitions.

“Commission Approval Order” means an approval order issued by the Public Utilities Commission of the State of Hawaii (“Commission”) that does not contain terms and conditions deemed unacceptable to the parties to the New Supply Contract, and is in a form deemed to be reasonable by those parties, ordering that
(i)the New Supply Contract is approved; (ii) the purchased cost of the product to be incurred by the Companies as a result of the New Supply Contract is reasonable; (iii) the Companies’ purchase of the product pursuant to the New








Supply Contract is prudent and in the public interest; and (iv) the Companies may include the product purchased costs and costs incurred by the Companies pursuant to the New Supply Contract in the Companies’ revenue requirements for ratemaking purposes and for the purposes of determining the reasonableness of the Companies’ rates and/or for cost recovery above those fuel costs included in the base rate through the Companies’ Energy Cost Recovery Clause during the initial term and any extension of the New Supply Contract.

“Non-Appealable Commission Approval Order” means a Commission Approval Order that is not subject to appeal to any Circuit Court of the State of Hawai‘i, the Intermediate Court of Appeals of the State of Hawai‘i, or the Supreme Court of the State of Hawai‘i, because the period permitted for such an appeal has passed without the filing of notice of such an appeal, or that was affirmed on appeal to any Circuit Court of the State of Hawai‘i, the Intermediate Court of Appeals of the State of Hawai‘i, or the Supreme Court of the State of Hawai‘i, or was affirmed upon further appeal or appellate process, and that is not subject to further appeal, because the jurisdictional time permitted for such an appeal and/or further appellate process such as a motion for reconsideration or an application for writ of certiorari has passed without the filing of notice of such an appeal or the filing for further appellate process.

3.Conditional Update to Tier 1 Volumes.

If and only if the Parties receive a Non-Appealable Commission Approval Order with respect to the New Supply Contract prior to December 2, 2022, Section 3.2(a)(1) of the Existing Contract with respect to [...] shall be [...] by [...] and [...]. For the avoidance of doubt, if such Non-Appealable Commission Approval Order is not obtained by December 2, 2022, there shall be [...].

4.Effective Date. The effective date of the amended language in Section 3 (Conditional Update to Tier 1 Volumes) [...] is the first day of the month after the Commission issues the Non-Appealable Commission Approval Order; provided that the Commission Approval Order becomes a Non-Appealable Commission Approval Order within sixty (60) days.

5.Choice of Law. This Amendment shall be governed by, construed, and enforced pursuant to the laws of the State of Hawaii without giving effect to its conflicts of laws principles.

6.Counterparts; Headings. This Amendment may be executed by the Parties in separate counterparts and delivered in electronic mail or portable data format (.pdf) or other electronic transmission. All such counterparts shall together constitute one and the same instrument. The headings and captions used herein are for convenient reference only and have no force or effect or legal meaning in the construction or enforcement of the Amendment.








7.Amendment. This Amendment shall not be modified or changed except by written instrument executed by the Parties’ duly authorized representatives.

8.Ratification of Agreement. Except as expressly set forth in this Amendment, the Existing Contract shall remain in full force and effect and is hereby ratified and confirmed in all respects.



[Signature page follows]








IN WITNESS WHEREOF, the Parties have duly executed this Amendment as of the date set forth above.

HAWAIIAN ELECTRIC COMPANY, INC.
By/s/ Robert Isler
Its:VP, Power Supply
By/s/ Shelee Kimura
Its:President & CEO
HAWAII ELECTRIC LIGHT COMPANY, INC.
By/s/ Robert Isler
Its:Vice President
By/s/ Shelee Kimura
Its:Chairman & President
MAUI ELECTRIC CO., LTD.
By/s/ Robert Isler
Its:Vice President
By/s/ Shelee Kimura
Its:Chairman & President
PAR HAWAII REFINING, LLC
By/s/ Eric Wright
Its:President

HEI Exhibit 10.12

HAWAIIAN ELECTRIC INDUSTRIES, INC.
NONEMPLOYEE DIRECTOR RETIREMENT PLAN


1.Purpose of the Plan
The purpose of the Nonemployee Director Retirement Plan is to enhance the ability of Hawaiian Electric Industries, Inc. to attract and retain the services of nonemployee directors by providing such individuals with annual retirement benefits subject to the conditions and limitations of the Plan.

2.Definitions
When used herein, the following terms shall have the respective meanings set forth below:
(a)"Annual Retainer" means the annual retainer established each year as the total dollar amount to be paid to all Nonemployee Directors in cash and/or stock for their services to the Company and other Participating Companies (exclusive of any per meeting fees and expense reimbursements).
(b)"Board" means the Board of Directors of the Company.
(c)"Company" means Hawaiian Electric Industries, Inc., a Hawaii corporation, and any successor corporation.
1


(d)"Director" means any person who is elected or appointed to the Board of Directors of the Company or any other Participating Company.
(e)"Employee" means any officer or employee of the Company or of any of its direct or indirect subsidiaries or affiliates (whether or not such subsidiary or affiliate participates in the Plan).
(f)"Nonemployee Director" or "Participant" means any Director who is not an Employee and who is otherwise eligible to receive benefits under the Plan.
(g)"Participating Company" means the Company and any direct or indirect subsidiary or affiliate of the Company whose participation in the Plan has been approved by such subsidiary's or affiliate's Board of Directors.
(h)"Plan" means the Company's Nonemployee Director Retirement Plan as set forth herein, as it may be amended from time to time.
(i)"Retire" or "Retirement" shall mean the termination of service of a Director by resignation of the Director, expiration of office without re-election or for any other reason (other than as a result of the removal of the Director for cause).

2


(j)"Retirement Benefits" shall mean the retirement benefits payable to Nonemployee Directors under Section 5 hereof.
(k)"Years of Service" shall mean the full years of service of a Director as a Nonemployee Director for one or more Participating Companies. If a Nonemployee Director serves during any period as a Director for more than one Participating Company at the same time, such period shall be counted only once in determining Years of Service under the Plan. "Years of Service" shall include periods of service prior to the effective date of the Plan and shall include service as a Nonemployee Director of any Participating Company prior to such company becoming a Participating Company, but limited (except with respect to Nonemployee Directors of Hawaiian Electric Company, Inc. ("HECO")) to periods during which such company was a subsidiary or affiliate of the Company.

3.Administration of the Plan
(a)The Plan will be administered by the Board or by a committee appointed by the Board (the "Committee"). The Company shall pay all costs of administration of the Plan. Subject to the express provisions of the Plan, the Board and the Committee, if any, has and may exercise such

3


powers and authority as may be necessary or appropriate to carry out its functions under the Plan. Without limiting the generality of the foregoing, the Board and the committee, if any, shall have full power and authority (i) to determine all questions of fact that may arise under the Plan, (ii) to interpret the Plan and to make all other determinations necessary or advisable for the administration of the Plan, and (iii) to prescribe, amend, and rescind rules and regulations relating to the Plan, including, without limitation, any rules which the Board determines are necessary or appropriate to ensure that the Company, each Participating Company and the Plan will be able to comply with all applicable provisions of any federal, state or local law, including laws relating to the withholding of tax. All interpretations, determinations, and actions by the Board will be final, conclusive, and binding upon all parties.
(b)Neither the Company, nor any other Participating Company, nor any representatives, employees or agents of any Participating Company, nor any member of the Board or designee thereof will be liable for any damages resulting from any action or determination made by the Board with respect to the Plan or any transaction arising

4


under the Plan or any omission in connection with the Plan in the absence of willful misconduct or gross negligence.

4.Participation in the Plan
(a)A Nonemployee Director shall be entitled to receive Retirement Benefits under the Plan if he or she has at least five (5) consecutive full Years of Service as a Nonemployee Director (i.e., without any break in service for any reason). The amount and the manner of payment of such benefits will be as provided below in Section 5.
(b)No Director who serves or has at any time served (before or after the effective date of the Plan) as an Employee shall be entitled to receive Retirement Benefits under the Plan, even if such Director otherwise satisfies the requirements for receiving such benefits, even if such benefits have already accrued and even if payments under the Plan have already commenced (in which case such payments shall immediately cease and terminate); provided, however, that no Director shall be required to return any Retirement Benefits that have already been paid.
(c)No Nonemployee Director shall be entitled to receive Retirement Benefits under the Plan if removed for cause from the Board of Directors of

5


the Company or any other Participating Company at any time, even if such Director otherwise satisfies the requirements for receiving such benefits and even if such benefits have already accrued.

5.Retirement Benefits
(a)If a Nonemployee Director Retires on or after the Nonemployee Director reaches age 65, the Company shall pay (or, if the Nonemployee Director is not a Director of the company, the Participating Companies for which the Nonemployee Director serves as a director shall pay) the Nonemployee Director annually a cash amount equal to the Annual Retainer which was established for the year of Retirement. Such payments shall commence upon Retirement as provided in Section 5(e) below and shall be made for a period of time equal to the number of full Years of Service accumulated by the Nonemployee Director, except as otherwise provided herein.
(b)If a Nonemployee Director Retires before the Nonemployee Director reaches age 65, the Company shall pay (or, if the Nonemployee Director is not a Director of the Company, the Participating Companies for which the Nonemployee Director serves as a director shall pay) the

6


Nonemployee Director annually a cash amount equal to the Annual Retainer which was established for the year of Retirement. Such payments shall commence upon the Nonemployee Director reaching age 65 as provided in Section 5(e) below and shall be made for a period of time equal to the number of full Years of Service accumulated by the Nonemployee Director, except as otherwise provided herein.
(c)If a Nonemployee Director Retires and later becomes a Nonemployee Director, payments under the Plan shall be suspended until such time as the Director again Retires. When such payments commence or recommence upon such Retirement, the Company shall pay the Director annually a cash amount equal to the Annual Retainer which was established for the subsequent year of Retirement, provided such Director has served as a Nonemployee Director during any period for at least five (5) consecutive years (i.e., without any break in service for any reason) and is otherwise entitled to receive Retirement Benefits under the Plan. Such payments shall commence or recommence upon the Director's subsequent Retirement as provided in Section 5(e) below and shall be made for the number of full Years of Service accumulated by the Director (less any period of time for which

7


payments were previously made under the Plan), which may include any additional period of service which may have accrued since the recommencement of service. For purposes of determining such accumulated Years of Service, partial Years of Service may be aggregated.
(d)Notwithstanding the foregoing, all payments to be made to a Nonemployee Director under the Plan and the Company's obligation to make such payments to the Nonemployee Director, whether the payments have commenced or not, shall cease and immediately terminate upon the death of the Nonemployee Director.
(e)The payment of Retirement Benefits to a Nonemployee Director under the Plan shall commence on the first day of the fiscal quarter next following the date of Retirement (or, in the case of payments under subsection(b) above, on the first day of the fiscal quarter next following the date upon which the Nonemployee Director reaches age 65), and shall be paid in quarterly installments. Notwithstanding the foregoing, the Board shall have the right in its sole discretion to vary the manner and time of making the payments under the Plan and may make such payments in lump

8


sums or over a shorter of longer period of time as it may find appropriate.

6.Source of Benefits
Nothing contained in the Plan and no action pursuant to the provisions of the Plan shall create or be construed to create a trust of any kind, or a fiduciary relationship between the Company or the Board and any Director, his designated beneficiary or any other person. The Company does not intend to set aside any funds in contemplation of its obligations hereunder. However, any funds which may be set aside or invested in contemplation of the Company's obligations under the Plan shall continue for all purposes to be part of the general funds of the Company and no person other than the Company shall by virtue of the provisions of the Plan have any interest in such funds. To the extent that any person acquires a right to receive payments from the Company under the Plan, such right shall be no greater than the right of any unsecured general creditor of the Company.

7.Continuation of Director or Other Status
Nothing in the Plan or in any instrument executed pursuant to the Plan or any action taken pursuant to the Plan shall be construed as creating or constituting evidence of any agreement or understanding, express or implied, that the Company or any other Participating Company, as the case may be, will retain a Nonemployee Director as a Director or
9


in any other capacity for any period of time or at a particular retainer or other rate of compensation, as conferring upon any Participant any legal or other right to continue as a Director or in any other capacity, or as limiting, interfering with or otherwise affecting the right of a Participating Company to terminate a Participant in his or her capacity as a Director or otherwise at any time for any reason, with or without cause, and without regard to the effect that such termination might have upon him or her as a Participant under the Plan.

8.Compliance with Government Regulations
Neither the Plan nor the Company shall be obligated to make any payments pursuant to the Plan at any time unless and until all applicable requirements under federal and state laws, rules, and regulations, or by any regulatory agencies, have been fully met.

9.Nontransferability of Rights
No Participant may assign the right to receive Retirement Benefits under the Plan or any other right or interest under the Plan, contingent or otherwise, or to cause or permit any encumbrance, pledge or charge of any nature to be imposed on any such right or interest.

10.Amendment and Termination of Plan
The Board will have the power, in its discretion, to amend, suspend or terminate the Plan at any time, provided
10


that no amendment, suspension or termination of the Plan will, without the consent of the Participant, alter, terminate or reduce any benefits which have accrued under the Plan, unless such amendment, suspension or termination is required by applicable law.

11.Governing Law
The laws of the State of Hawaii shall govern and control the interpretation and application of the terms of the Plan.

12.Effective Date and Duration of the Plan
This Plan will become effective as of October 1, 1989. Nonemployee Directors who have retired prior to such date shall not be entitled to receive Retirement Benefits under the Plan.
11

HEI Exhibit 31.1
 
CERTIFICATION
 
I, Scott W. H. Seu, certify that:
 
1. I have reviewed this report on Form 10-Q for the quarter ended March 31, 2022 of Hawaiian Electric Industries, Inc. (“registrant”);
 
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
 
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
 
4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
 
(a)   Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
 
(b)   Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
 
(c)   Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
 
(d)   Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
 
5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
 
(a)   All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
 
(b)   Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
 
Date: May 9, 2022
 
 /s/ Scott W. H. Seu
 Scott W. H. Seu
 President and Chief Executive Officer
 

HEI Exhibit 31.2
 
 
CERTIFICATION
 
I, Gregory C. Hazelton, certify that:
 
1. I have reviewed this report on Form 10-Q for the quarter ended March 31, 2022 of Hawaiian Electric Industries, Inc. (“registrant”);
 
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
 
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
 
4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
 
(a)   Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
 
(b)   Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
 
(c)   Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
 
(d)  Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
 
5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
 
(a)   All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
 
(b)   Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
 
Date: May 9, 2022 
 /s/ Gregory C. Hazelton
 Gregory C. Hazelton
 Executive Vice President and Chief Financial Officer
 

Hawaiian Electric Exhibit 31.3
 
CERTIFICATION
 
I, Shelee M. T. Kimura, certify that:
 
1. I have reviewed this report on Form 10-Q for the quarter ended March 31, 2022 of Hawaiian Electric Company, Inc. (“registrant”);
 
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
 
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
 
4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
 
(a)   Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
 
(b)   Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
 
(c)   Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
 
(d)   Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
 
5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
 
(a)   All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
 
(b)   Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
 
Date: May 9, 2022 
 /s/ Shelee M. T. Kimura
 Shelee M. T. Kimura
 President and Chief Executive Officer

Hawaiian Electric Exhibit 31.4
 
CERTIFICATION
I, Tayne S. Y. Sekimura, certify that:
1.I have reviewed this report on Form 10-Q for the quarter ended March 31, 2022 of Hawaiian Electric Company, Inc. (“registrant”);
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
 4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
 
(a)   Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
 
(b)   Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
 
(c)   Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
 
(d)   Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
 
5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
 
(a)   All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
 
(b)   Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
Date: May 9, 2022 
 /s/ Tayne S. Y. Sekimura
 Tayne S. Y. Sekimura
 Senior Vice President, Chief Financial Officer and Treasurer

HEI Exhibit 32.1
 
Hawaiian Electric Industries, Inc.
 
Certification Pursuant to
18 U.S.C. Section 1350
 
In connection with the Quarterly Report of Hawaiian Electric Industries, Inc. (HEI) on Form 10-Q for the quarter ended March 31, 2022, as filed with the Securities and Exchange Commission (the Report), each of Scott W. H. Seu and Gregory C. Hazelton, Chief Executive Officer and Chief Financial Officer, respectively, of HEI, certify, pursuant to 18 U.S.C. Section 1350, that to the best of his knowledge:
 
(1)   The Report complies with the requirements of section 13(a) of the Securities Exchange Act of 1934, as amended; and
 
(2)   The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of HEI and its subsidiaries as of, and for, the periods presented in this report.

 
Date: May 9, 2022
 
/s/ Scott W. H. Seu
Scott W. H. Seu
President and Chief Executive Officer
 
/s/ Gregory C. Hazelton
Gregory C. Hazelton
Executive Vice President and Chief Financial Officer
 
A signed original of this written statement has been provided to HEI and will be retained by HEI and furnished to the Securities and Exchange Commission or its staff upon request.
 

Hawaiian Electric Exhibit 32.2
 
Hawaiian Electric Company, Inc.
 
Certification Pursuant to
18 U.S.C. Section 1350
 
In connection with the Quarterly Report of Hawaiian Electric Company, Inc. (Hawaiian Electric) on Form 10-Q for the quarter ended March 31, 2022, as filed with the Securities and Exchange Commission (the Hawaiian Electric Report), each of Shelee M. T. Kimura and Tayne S. Y. Sekimura, Chief Executive Officer and Chief Financial Officer, respectively, of Hawaiian Electric, certify, pursuant to 18 U.S.C. Section 1350, that to the best of her knowledge:
 
(1)   The Hawaiian Electric Report complies with the requirements of section 13(a) of the Securities Exchange Act of 1934, as amended; and
 
(2)   The Hawaiian Electric information contained in the Hawaiian Electric Report fairly presents, in all material respects, the financial condition and results of operations of Hawaiian Electric and its subsidiaries as of, and for, the periods presented in this report. 


 
Date: May 9, 2022
/s/ Shelee M. T. Kimura
Shelee M. T. Kimura
President and Chief Executive Officer
 
/s/ Tayne S. Y. Sekimura
Tayne S. Y. Sekimura
Senior Vice President, Chief Financial Officer and Treasurer
 
A signed original of this written statement has been provided to Hawaiian Electric and will be retained by Hawaiian Electric and furnished to the Securities and Exchange Commission or its staff upon request.