HECO's Response to Consumer Advocate's Comments, 4/29/11

EXHIBIT 1PAGE 6 OF 19The short answer to this contention is that that is true of other surcharge provisions inHawaii. See Consumer Advocate Comments at 14-18. Moreover, the Company’s position isconsistent with the operation of other surcharge mechanisms in Hawaii, including the operationof the DSM surcharge, in which lost revenue margins were estimated and accrued in the calendaryear that they were earned, and were collected over part of the current calendar year and part inthe subsequent calendar year. The amount of the lost revenue margins were calculated for thecalendar year and were presented in a DSM cost recovery filing made by March 31 st of thatcalendar year. Collection of lost revenue margins for the calendar year commenced on April 1stof that calendar year and continued over 12 months through March 31 st of the immediatelysucceeding calendar year through the DSM cost recovery adjustment. Hawaiian ElectricComments, Exhibit 1, at 20-23.In addition, the Consumer Advocate ignores, or unsuccessfully attempts to discount theextensive evidence in the record showing that the accrual period tracked the calculation periodfor the RAM revenues, while the collection of the RAM revenues lagged the accrual period tofacilitate the calculation and review of RAM filings. As is discussed below, the evidence in therecord supports the Company’s position.ProrationThe Consumer Advocate challenges the proration (for 306 days out of 365 days, i.e., tenmonths) of the estimated annual O&M RAM and Rate Base RAM to reflect the March 1, 2011,decoupling effective/implementation date, on the grounds that proration is not explicitly referredto “in the Commission-approved RBA or RAM tariffs.” Consumer Advocate Comments at 8-9& n.7.3357864.1