The biggest business deal in state history is in a new state of limbo as the governor makes a new appointment to the Public Utilities Commission that some are calling illegal and unethical.
The attorney general’s office says the appointment is valid.
The governor announced Wednesday the appointment of Thomas Gorak to the commission. Gorak has been serving as the commission’s legal counsel throughout the Hawaiian Electric-NextEra Energy merger discussion. Because of that, some say he shouldn’t now be in the mix to decide whether or not it happens.
Gorak has been the utility agency’s chief lawyer, appointed by Gov. David Ige to become one of its three commissioners. Ige says the appointment is effective Friday, after Michael Champley’s term expires June 30.
“I was looking for commissioner that was committed to a 100-percent clean energy initiative,” Ige said. “I was looking for someone with experience.”
Gorak’s experience includes working as PUC counsel on hearings and reviews of the HECO-NextEra merger — the biggest deal in state history.
“I have been intimately involved from the beginning,” Gorak said. “I was involved in hearings, been to the public listening sessions. There is a draft circulating we will reveal. Any decision made will be based on the record evidence and on the law.”
Gorak even helped write the draft order on the merger and now will also get to vote if Champley, Commissioner Lorraine Akiba and Chairman Randy Iwase don’t issue one by Thursday, June 30.
As Always Investigating first revealed, they’ve been reviewing it since early May, after an extensive hearings process in the year and a half since the intent to merge was announced.
Prior to the governor’s appointment, the chairman said he had aimed to wrap up the order before the end of June.
“The longer it sits, the more rumors fly around, crazy rumors,” Iwase told Always Investigating in early June, to which Always Investigating asked, “Any truth to the rumor that they’re waiting out one of the commissioner’s terms on the 30th?” Iwase’s response: “No, and that’s one of the rumors flying around. We have no control over that. That happens to be the law. If that happens, it happens.”
With the chairman’s June target for the HECO order come and nearly gone, there is no new specific due-date projected.
Always Investigating asked a former chairperson of the PUC, for a draft order to take this long to circulate, almost two months, what does it say about the consensus or lack of it on this order?
“There’s no agreement on the draft order,” said Hermina Morita, past PUC chair and, since her departure, a vocal HECO merger advocate.
If it’s only a yes or no answer essentially, and there’s only three commissioners, does this point to it not being the consensus the chairman wants?
“If the chairman controls the resources getting the draft order done, that’s the only thing that can be concluded,” Morita said.
Ige says the appointment has nothing to do with Gorak’s position on the merger. The governor says he didn’t ask.
“I have not had any discussions with any commission members about their positions on NextEra, so I have no idea about what the decision is or is not,” Ige said.
We asked the governor why Champley had to go.
“I do know and am aware that Mr. Champley had disagreed with the previous chair in the commission and on many instances had prevented the previous chair of the commission from moving forward,” Ige said. “I passed the measure to restructure the commission because of the challenges the commission was having.”
The former PUC chair says the governor’s move is not right. Morita points to statute that says a member shall hold office until an appointment gets confirmed, not just announced. She said interim PUC appointments are valid only when there’s an outright vacancy, not just an expiration.
“Mr. Champley is still a commissioner and he is legally entitled to remain a commissioner until his successor is appointed, and qualified by the Senate,” Morita said.
Champley tells me he did not resign, and that he also reads the statute the same way as the former chair.
Ige says he got an attorney general opinion clearing the move. The attorney general says it’s okay under the state constitution to boot an expired commissioner with an interim appointment when the legislature is on break.
“He is an interim appointment,” Ige said. “He can begin July 1, then we will deal with what follows after that.”
Law aside, some also raise ethics questions.
“I’m concerned about Mr. Gorak’s role at this point, because he appeared to be a litigator in the merger application and now he is turning around to be a possible adjudicator,” Morita said. “If this appointment process is flawed then any decision made by the governor’s appointment would be flawed in itself.”
“I will make the decisions that I believe are based on the record and the law as I review each decision,” Gorak said.
Supporters of the appointment think it bodes well for residents and Hawaii’s energy future, with more than just a merger at stake — consumer access to solar, a transformation to 100-percent renewables, and whether LNG will be allowed to be a bridge fuel meanwhile.
“I don’t think anybody else who clearly has as much background in utilities, in electricity and what it means for Hawaii to actually transition to a better future,” said Rep. Chris Lee, “and deal with the merger and all the other dockets that are other there.”
What about HECO and NextEra meanwhile? Their last public statement was nearly a month ago after their preferred decision deadline came and went, saying “as of today, neither party has terminated the deal.”
NextEra says that still applies today, and neither HECO nor its mainland suitor is offering any new, additional comment.