The Hawaii Public Utilities Commission (PUC) has issued an interim decision approving Hawaiian Electric Company’s first base-rate increase in more than six years.

The approximate 2.5 percent increase will help pay for initiatives that increase reliability and resilience, improve customer service, and help integrate more renewable energy.

The effective date of the new rate will be determined by the commission. An interim decision is one step in the rate-making process. The PUC will continue to review the request and will later issue a final decision on the rates.View the PUC’s full interim decision and order here.

The approved interim rate will increase the typical Oahu monthly residential bill for 500 kilowatt hours by about $2.82.

For business owners, like Annie Yeung of Panya Bistro in Ward Village, the electricity cost increase is just one concerns.

“Over the years, we experienced different increments or raises in the rates, and of course that’s the last thing we want to hear, because we will have to deal with other rates going up, like minimum wage, which is coming up too,” she said.

The increase could mean hundreds, even thousands of dollars in increasing costs depending on the size of the business.

C.C. Foo, owner of Butterfly Ice cream in Kakaako, says he’s done everything he can to keep his business energy efficient, including separate freezers for off-hours, and adding a kill switch to the ice cream maker.

Yeung says upgraded equipment helps keep costs down. “Luckily our location here is like four years old, so pretty much when we built this one, it had a lot of energy saving equipment that we included,” she said.

The rate is not what HECO originally asked for, which was 6.9 percent.

In a statement, HECO president and CEO Alan Oshima called the decision extremely disappointing.

He said the company came to a settlement last month with the state Division of Consumer Advocacy for a 3.5 percent increase.

Contrary to the settlement, the PUC disallowed the recovery of a portion of pension expenses that the company had paid and was seeking to be recovered through previously approved mechanisms, HECO said.

“After going six years without a base rate increase, while investing in work to move Hawaii to reach 100-percent renewable energy in full support of our state’s recently adopted policy, we’re extremely disappointed with this outcome,” said Alan Oshima, president and CEO of Hawaiian Electric. “It’s especially disappointing because we worked for months to achieve what we believed was a fair negotiated settlement with the Consumer Advocate that was in the best interest of customers.”

The company expects to file a motion for reconsideration with the PUC this week.