Hawaiian Electric Industries, Inc. (HE): PESTLE Analysis [Nov-2025 Updated]

Hawaiian Electric Industries, Inc. (HE) is facing a perfect storm, moving from a predictable utility model to a high-risk entity defined by legal liabilities and an aggressive energy transition mandate. You need a clear map of the external forces shaping its future, becuase the company is currently navigating potential billions in wildfire-related legal costs while simultaneously needing to spend over $1.5 billion on grid hardening and modernization to meet the state's 100% renewable energy goal. This PESTLE analysis cuts through the noise to show you exactly where the Political, Economic, Sociological, Technological, Legal, and Environmental pressures are creating both existential risks and forced opportunities for the company right now.

Hawaiian Electric Industries, Inc. (HE) - PESTLE Analysis: Political factors

Intense regulatory scrutiny from the Hawaii Public Utilities Commission (PUC)

You need to understand that Hawaiian Electric Industries, Inc. (HE) operates under a microscope in 2025, largely due to the fallout from the 2023 Maui wildfires. The Hawaii Public Utilities Commission (PUC) scrutiny is defintely intense, and it's not just about rates anymore; it's about public safety and operational competence.

The PUC opened a formal docket (Docket No. 2025-0156) in January 2025 to scrutinize Hawaiian Electric's Wildfire Mitigation Plan (WMP), demanding proof that the plan aligns with regulatory requirements and is reasonably expected to reduce fire risk. This is a deep dive, not a rubber stamp. Plus, in November 2025, the PUC suspended a power purchase agreement application by Maui Electric Company (MECO), a Hawaiian Electric subsidiary, because it failed to comply with the Hawaii Environmental Policy Act (HEPA) for a new power-generating facility. That's the regulator showing teeth.

Here's the quick math on service reliability that is driving legislative anger:

• Power outages have increased almost threefold since 2020.
• Nearly 13,000 people were disconnected for non-payment in 2023 alone.

State government push for 100% renewable energy by 2045 remains a core mandate

The state's mandate for 100% renewable energy by 2045 (Act 97) is a non-negotiable political cornerstone. Hawaiian Electric is a central player in this transition, and their progress is constantly monitored.

The company is making strides, but the pressure is immense. Hawaiian Electric achieved a consolidated renewable portfolio standard (RPS) of 35.8% in 2024, exceeding the state's prior 30% goal. To keep momentum, they have 16 new solar-plus-storage and standalone-storage projects underway, which are expected to add nearly 7 percentage points to the RPS by the end of 2025. Still, getting to 100% requires massive, sustained political and financial commitment, and the state's reliance on petroleum for 80% of its total energy consumption shows the scale of the challenge.

Political pressure to lower customer bills despite grid hardening investment needs

This is the political tightrope walk: the need for a safer, hardened grid clashes directly with the political desire for affordable electricity. Hawaii's electricity prices are already about three times the U.S. national average.

Hawaiian Electric's expanded 3-year Wildfire Safety Strategy, which is essential for grid hardening, is projected to cost $350 million in total, with $137 million budgeted for work in the 2025 fiscal year. This investment is necessary, but it translates directly into higher customer bills. The estimated monthly residential bill increases, if approved, are significant, especially on Maui County, the area of highest wildfire risk.

The political solution to this cost-vs-safety dilemma is the new liability legislation, which includes a mechanism to finance the work more cheaply.

Potential for legislative changes to liability standards for utility operations

The political environment shifted dramatically in May 2025 with the passage of Senate Bill 897 (SB 897), a crucial legislative change that directly addresses utility liability and financing. This bill is a clear political move to ensure Hawaiian Electric's financial viability while forcing safety upgrades.

The legislation does two critical things:

• It directs the PUC to establish a liability cap on economic damages arising from future catastrophic wildfires. This is a major risk reduction for Hawaiian Electric.
• It authorizes the use of securitization-long-term bonds-to finance wildfire safety investments, capping the amount the utility can securitize at $500 million. Securitization allows the company to borrow at a lower interest rate, which is intended to save consumers money compared to traditional financing.

This legislative action, coupled with the state's appropriation of approximately $807.5 million from its general fund for the state's share of the $4 billion global settlement related to the 2023 Maui wildfires, significantly reduces the credit risk for Hawaiian Electric and limits its liability exposure in that specific case to $1.99 billion. The political establishment is using its power to stabilize the utility, but they are demanding a safer grid in return. That's the trade-off.

Hawaiian Electric Industries, Inc. (HE) - PESTLE Analysis: Economic factors

Significant legal and financial liabilities impacting bond ratings and cost of capital.

The financial fallout from the 2023 Maui wildfires has fundamentally altered Hawaiian Electric Industries' (HE) economic profile, moving it from investment-grade to a speculative-grade borrower. The significant legal liability has been provisionally capped at an estimated $1.99 billion for the company's contribution to the global settlement, which totals approximately $4 billion. This massive liability exposure, though partially mitigated by the settlement, triggered a steep downgrade of the company's credit ratings.

In 2025, credit rating agencies have shown some positive movement, but the risk remains high. As of June 2025, S&P Global Ratings upgraded Hawaiian Electric Company's (HECO) long-term issuer credit rating to 'B+' from 'B-', while Moody's upgraded HECO's issuer rating to 'Ba2' in May 2025. This is an improvement, but it still firmly places the company's debt in the 'junk bond' category, which translates directly into a higher cost of capital (the rate of return a company must pay to finance its assets).

Here is a snapshot of the company's debt financing in 2025:

Estimated grid hardening costs projected to exceed $1.5 billion over five years.

The economic necessity of massive infrastructure investment to enhance resilience is a major capital pressure. While the specific 3-year Wildfire Safety Strategy (2025-2027) is budgeted at $350 million, the total projected capital expenditures (CapEx) for the utility from 2026 through 2028 are estimated to be between $1.8 billion and $2.4 billion. This massive spending is largely driven by the urgent need for grid hardening and modernization, far exceeding the initial $1.5 billion figure over a similar timeframe.

This capital program is a necessary cost of doing business in a climate-challenged environment. It's a huge upfront expense that must be financed and ultimately recovered through the regulatory rate-making process, a key economic risk area.

• 2025 CapEx is projected at approximately $400 million.
• 2026 CapEx is expected to rise to between $550 million and $700 million.
• The 3-year wildfire plan alone dedicates $137 million for work in 2025.

High interest rate environment makes financing new capital projects more expensive.

The combination of a high interest rate environment and the company's downgraded, sub-investment grade credit rating creates a significant headwind for financing new capital projects. The $500 million in senior unsecured notes issued in September 2025 carried a 6.000% coupon. That's a high cost to raise capital, especially for a regulated utility. Here's the quick math: that single debt issuance adds $30 million in annual interest expense to the income statement (before considering the tax shield), putting pressure on core earnings.

The need to finance the multi-billion dollar CapEx plan over the next few years means the company will be consistently exposed to these elevated borrowing costs, which is a structural drag on financial performance. Securitization financing, if approved by regulators, is being pursued as a way to lower the cost of borrowing for wildfire safety infrastructure, but it's not a guarantee for all capital needs.

Tourism-dependent state economy creates revenue sensitivity to economic downturns.

Hawaii's economy is heavily reliant on tourism, which represents roughly a quarter of its economic activity. This dependence creates a fundamental revenue sensitivity for Hawaiian Electric Industries, Inc. (HE), even as a regulated utility. While the state's real GDP grew 1.5 percent in the first quarter of 2025, visitor arrivals are projected to remain stable for the full year, with total visitor spending projected at $21.2 billion in 2025.

Any significant economic downturn-domestic or global-would immediately hit visitor arrivals and spending, reducing electricity consumption in high-use sectors like hotels, resorts, and commercial properties. This revenue sensitivity is an economic risk that is somewhat mitigated by the utility's regulatory model, which is designed to ensure cost recovery, but a sharp drop in demand can still complicate rate-making and cash flow projections.

The cost to service new debt following the 2023 crisis is a major drag on earnings.

The financial strain from the crisis is clearly visible in the 2025 earnings reports. Higher interest expense and increased operating costs related to wildfire mitigation and legal fees are directly compressing net income. For the first quarter of 2025, Hawaiian Electric reported a $2 million pre-tax increase in interest expense. More broadly, the utility's core net income for the third quarter of 2025 was $39.6 million, a noticeable drop from $43.7 million in the same quarter of 2024.

This decline in core profitability, despite a revenue of $790.61 million in Q3 2025, is driven by non-fuel operating expenses, including higher legal and consulting costs, plus increased wildfire mitigation program expenses. The utility is defintely feeling the economic weight of the crisis, even with regulatory deferrals in place to manage some of the costs.

• Q3 2025 Utility Core Net Income: $39.6 million.
• Q3 2024 Utility Core Net Income: $43.7 million.
• The holding company's core net loss improved to $6.8 million in Q3 2025, partly due to lower interest expense following a $384 million debt retirement in April 2025.

Finance: Track the finalization of the $1.99 billion liability and the terms of the new securitization bond issuance for cost-of-capital modeling by year-end.

Hawaiian Electric Industries, Inc. (HE) - PESTLE Analysis: Social factors

Extremely poor public sentiment and trust following the 2023 Maui wildfires

The August 2023 Maui wildfires created a public trust crisis for Hawaiian Electric Industries, Inc. (HE), a deep-seated issue that continues to impact operations and financial stability through 2025. The company faced a significant legal and financial fallout, which directly eroded public confidence in its safety protocols and infrastructure resilience.

The financial impact alone is a clear indicator of the severity. In its Q2 2024 results, the company reported a net loss of $1.3 billion, largely driven by a $1.71 billion accrual for estimated wildfire liabilities related to tort claims. This massive liability led the company to warn about a potential 'going concern' risk. While a legislative settlement was signed in July 2025, the damage to public trust is long-term, especially after a January 2025 wildfire safety strategy filed with the Public Utilities Commission (PUC) was later assessed in August 2025 as having 'critical deficiencies' and not meeting a sufficient level of safety standard. Honestly, the company is still in the trust-rebuilding phase, and it will take years of flawless execution to recover.

Strong community resistance to high electricity rates, already among the nation's highest

Hawaiian Electric operates in a state where the cost of power is a major social and economic pain point. Hawaii consistently holds the title for the nation's highest residential electricity rates. As of October 2025, the average residential rate was approximately 40.96¢ per kWh, which is more than double the U.S. national average. This high cost is primarily due to the islands' geographic isolation and reliance on imported petroleum for a substantial portion of power generation.

For a typical residential customer consuming 500 kWh, the monthly bill on Hawaii Island was $228.54 in January 2025. Community resistance is amplified by the perception of poor service quality, with some lawmakers noting that power outages have increased dramatically since 2020. The upcoming rebasing of rates under the Performance-Based Regulation (PBR) plan, which is set to conclude its current five-year term, is a major flashpoint, with concerns that it could lead to one of the largest consumer cost increases in the state's history.

Here's a quick look at the high cost of power in Hawaii versus the national average:

Growing demand for energy independence and decentralized power generation (rooftop solar)

The high cost of electricity and a strong environmental ethos have fueled an aggressive social trend toward energy independence, primarily through customer-sited rooftop solar (distributed energy resources or DER). Hawaii has the highest rate of rooftop solar adoption in the US. This trend represents both a social opportunity and a technical challenge for Hawaiian Electric.

As of March 2025, the total number of private rooftop solar systems connected to Hawaiian Electric's grids reached nearly 114,000 across the five islands it serves. On Oahu, the state's most populated island, rooftop solar penetration hit 44% among single-family homes by October 2025. This push for decentralized power means the utility must rapidly evolve its grid management to handle a massive, two-way flow of electricity, plus, it cuts into the utility's traditional revenue model.

• Total grid-connected solar capacity (all types) was 1,410 MW as of March 2025.
• The number of grid-connected solar systems grew by 7.5% in 2024.
• The cumulative installed solar power capacity surpassed 1 gigawatt (GW) by October 2025.

Workforce retention challenges due to high-stress, high-scrutiny operating environment

The operating environment for Hawaiian Electric Industries, Inc. employees is incredibly high-stress and subject to intense public and regulatory scrutiny, especially post-wildfires. While specific, recent turnover data for the utility itself is not public, the overall labor market in Hawaii is tight, which exacerbates any internal retention issues.

The state's overall turnover rate was 15.4% in 2024, and new-hire retention is a major issue, with a first-year turnover rate of 26.7% reported by organizations tracking this metric in a May 2025 survey. Talent retention was cited as a critical short- and long-term challenge by 45.5% of Hawaii executives in a January 2025 survey. The utility's staff is under pressure to execute a complex wildfire mitigation strategy that was criticized in an August 2025 expert report for being deficient. This kind of external pressure, coupled with the need to implement significant grid hardening and safety measures, creates a defintely challenging environment for retaining skilled, experienced employees.

To be fair, the company is taking steps, like partnering with UH Maui College to launch a new workforce training program to prepare Maui residents for potential jobs within power generating stations. But still, the high-scrutiny environment, which includes public complaints about service and even whistleblower reports about a toxic environment at the Public Utilities Commission, creates a difficult backdrop for employee morale and retention in the utility sector.

Next step: The HR department should commission a confidential, third-party employee sentiment and retention study for critical operations roles by the end of Q1 2026.

Hawaiian Electric Industries, Inc. (HE) - PESTLE Analysis: Technological factors

Mandatory accelerated deployment of advanced grid hardening and sectionalizing technology.

The imperative to modernize and secure the grid, particularly against wildfire risk, is driving a massive technological push. Hawaiian Electric Industries, Inc. (HE) has an expanded 2025-2027 Wildfire Safety Strategy with a projected total cost of $350 million, with approximately $137 million budgeted for work in the 2025 fiscal year alone.

This capital is directed toward physical grid hardening and advanced sectionalizing technology. The goal is to limit the geographic scope of an outage or fault. For instance, the company is deploying covered conductors-power lines with heavy-duty insulating material-in the highest-risk areas to prevent sparking if lines touch or fall.

You can see the immediate, concrete actions in the table below, which shows the core hardening technologies being prioritized.

The entire multi-year grid resilience plan, which addresses more than just fire risk, is valued at $190 million, and half of that is being pursued through federal funding to reduce customer costs. That's a defintely necessary investment to secure the network.

Need to integrate massive amounts of intermittent solar and wind power onto the grid.

The technical challenge of integrating massive amounts of variable, intermittent renewable energy-like solar and wind-is a core technological driver for Hawaiian Electric. The state's 100% renewable energy goal by 2045 means the grid must handle significant two-way power flow.

In 2024, the company achieved a consolidated Renewable Portfolio Standard (RPS) of 36%, a three-percentage-point increase from 2023. This progress is impressive, but it creates a complex engineering problem, especially with high levels of customer-sited resources (Distributed Energy Resources or DER).

Here's the quick math: the combined capacity of customer-sited rooftop solar and battery storage has already surpassed 1 gigawatt (GW). This means approximately 44% of single-family homes served by Hawaiian Electric now have rooftop solar, a national high.

To manage this high penetration, the company must rely on advanced grid technologies:

• Deploying advanced inverter technology to enable greater rooftop solar adoption and manage power quality.
• Expanding the use of voltage management tools on circuits with heavy solar saturation.
• Utilizing the recently completed full rollout of Advanced Meter Infrastructure (AMI), or smart meters, to better monitor and control DER.

Critical investment in battery Energy Storage Systems (ESS) to stabilize the grid.

Battery Energy Storage Systems (ESS) are the critical technological solution for stabilizing the grid against the variability of solar and wind power. They store excess energy during the day and release it when the sun sets or the wind drops, acting as a buffer. Hawaiian Electric is aggressively procuring and deploying this capacity.

The company is on a strong pace to reach its 2030 RPS milestone of 40%, largely due to new solar and storage projects. In 2025, a key project expected to complete commissioning is the Hoohana Solar I project on Oahu, which pairs 52 MW of solar with a substantial 208 MWh Battery Energy Storage System.

Looking ahead, the commitment to ESS is massive. Competitive procurements are set to bring nearly 3 gigawatt-hours (GWh) of energy storage to the islands, alongside 460 MW of new solar energy. This level of storage is essential to maintain system reliability as fossil-fuel generation is retired.

Adoption of smart grid sensors and AI for predictive maintenance to mitigate fire risk.

Beyond physical hardening, Hawaiian Electric is making a significant technological pivot toward enhanced situational awareness, using sensors and Artificial Intelligence (AI) to shift from reactive to predictive maintenance. This is a direct response to the heightened fire risk.

The company is investing in a $14 million project to install 78 high-resolution video cameras equipped with AI across high-risk areas. These AI-assisted cameras provide 360-degree views and continually monitor for anomalies, sending alerts to both the utility and first responders for early wildfire detection.

Additionally, they are expanding their network of weather stations. After installing 53 stations in 2024, they plan to add more in high and medium-risk areas in the next three years. This network provides real-time data on wind, temperature, and humidity, which is vital for making informed, real-time decisions about activating or deactivating the Public Safety Power Shutoff (PSPS) program. This technological layer is projected to reduce fire risk by a substantial 68% to 72%.

Hawaiian Electric Industries, Inc. (HE) - PESTLE Analysis: Legal factors

You're looking at Hawaiian Electric Industries (HEI) and the legal landscape is defintely the most critical area right now. The company is navigating a true crisis of liability and regulatory scrutiny following the 2023 Maui wildfires. The direct financial impact is massive, but the long-term legal and compliance changes are what will fundamentally reshape the business model for the next decade.

The core legal challenge is transitioning from defending against a catastrophic event to operating under a permanently higher standard of care, all while trying to rebuild financial stability. It's a high-stakes, multi-front war that requires precision in both litigation strategy and regulatory filings.

Facing hundreds of lawsuits related to the 2023 wildfires, with potential liability in the billions.

The most immediate and significant legal factor is the resolution of the tort litigation stemming from the August 2023 Maui wildfires. Hawaiian Electric Industries and its utility subsidiary, Hawaiian Electric, have reached an agreement in principle for a global settlement of all tort claims, which collectively totals over $4 billion. This agreement, which received preliminary court approval on June 19, 2025, aims to resolve claims from thousands of individuals and businesses.

Hawaiian Electric Industries' portion of this liability is substantial, pegged at a total contribution of $1.99 billion (pre-tax), which includes a previous $75 million contribution to the One 'Ohana Initiative. The first settlement payment is anticipated no earlier than mid-2025 or early 2026, and the company is financing this obligation through a mix of debt, equity, and other options. This settlement provides a crucial cap on the company's liability, which is vital considering the estimated capital cost of the disaster was around $5.5 billion. The company was named in approximately 400 lawsuits related to the fires.

Ongoing investigations by state and federal agencies into operational practices.

Beyond the civil litigation, Hawaiian Electric is under intense scrutiny from state regulatory and ethics bodies. The Hawaii Public Utilities Commission (PUC) is conducting a formal Wildfire Investigation (Case No. 2024-01872) to review the company's actions and practices. This is an operational deep dive, and the findings will inform future regulatory decisions, including rate cases.

Also, the Hawai'i State Ethics Commission resolved an investigation in November 2025 concerning Hawaiian Electric's lobbying activities. The company was found to have failed to register certain employees as lobbyists and report expenditures, resulting in an administrative penalty of $10,000. This investigation, while minor in financial terms, underscores the heightened regulatory oversight the company faces across all aspects of its operations.

Strict compliance requirements for new wildfire mitigation and safety standards.

The regulatory environment has fundamentally changed, creating strict new compliance requirements. New state legislation, effective July 2025, establishes a statutory wildfire-related liability standard, meaning compliance with an approved Wildfire Mitigation Plan (WMP) creates a rebuttable presumption of no negligence in future civil actions. This makes WMP approval and execution a legal necessity, not just an operational goal.

Hawaiian Electric filed its 2025-2027 Wildfire Safety Strategy (WSS) with the PUC on January 10, 2025, which is now under formal review (Docket No. 2025-0156). This plan outlines specific, mandatory actions:

• Deploying covered conductor (insulated power lines) on approximately 15-70 miles of high-risk distribution circuits.
• Implementing a Public Safety Power Shutoff (PSPS) program, which started in July 2024.
• Seeking PUC approval to commit funds for the WSS, including a total projected capital expenditure for 2026-2028 of $1.8 billion to $2.4 billion.

The cost of de-risking is hitting the bottom line now, with higher legal and wildfire mitigation program expenses contributing to a decline in the utility's core net income in Q3 2025.

Regulatory risk of disallowance for certain capital expenditures in future rate cases.

This is the big financial risk you need to track. Hawaiian Electric is projecting a monumental increase in capital expenditure (CapEx) to fund its safety and resilience work: 2025 CapEx is expected to be around $400 million, but this jumps to between $550 million and $700 million in 2026. The company must get PUC approval to recover these costs from ratepayers.

The regulatory risk is that the PUC may disallow (exclude from the rate base) some of these capital investments if they are deemed not 'used and useful' under traditional regulatory principles, or if the spending is deemed imprudent. Hawaiian Electric is pushing for an alternative rate rebasing process under Performance-Based Ratemaking (PBR) to reset revenues before the multi-year rate period begins in 2027, with a proposal due in January 2026. Failure to secure this rate recovery would significantly impair the company's financial health and its ability to fund the massive CapEx plan.

Here's the quick math: The difference between a successful CapEx recovery and a partial disallowance on a multi-billion dollar investment is the difference between solvency and severe financial distress. The PUC decision on rate rebasing is everything.

Next Step: Finance: Model the impact of a 15% CapEx disallowance scenario on the 2026-2028 capital plan and review the PUC's preliminary findings on Docket No. 2025-0156 by the end of the year.

Hawaiian Electric Industries, Inc. (HE) - PESTLE Analysis: Environmental factors

The environmental factors for Hawaiian Electric Industries, Inc. (HE) are not just regulatory hurdles; they are existential threats and massive capital expenditure drivers. The twin pressures of a state-mandated clean energy transition and climate change-driven disaster risk are forcing a fundamental, multi-billion-dollar overhaul of the entire grid. Honstely, this is the company's biggest challenge.

Extreme pressure to meet the 100% renewable energy portfolio standard (RPS) by 2045.

Hawaii's mandate for a 100% Renewable Portfolio Standard (RPS) by 2045 puts HE under extreme pressure. While the company is making good progress, the remaining transition is the hardest part. As of late 2024, the consolidated RPS for Oahu, Hawaii Island, and Maui County reached approximately 36%, a significant increase that puts them on a strong pace to reach the intermediate 2030 milestone of 40% ahead of schedule.

The focus is now shifting to firm, dispatchable renewable capacity-energy that can be called upon when needed, not just when the sun shines or the wind blows. The 2025 commercial operations of projects like Hoohana Solar 1 on Oahu, which adds 52 MW of solar capacity and a 208 MWh battery energy storage system (BESS), illustrate this shift. This integration of utility-scale storage is crucial for grid stability as oil-fired plants are retired.

Increased frequency and intensity of climate-driven events, like droughts and high winds.

Climate change is no longer a theoretical risk; it is a clear operational threat, exemplified by the 2023 Maui wildfires. This has forced HE to fully embrace a proactive, rather than reactive, stance on extreme weather. The company's new Public Safety Power Shutoff (PSPS) program is now a core tool, designed to de-energize lines in high-risk areas when wind gusts exceed 45 mph and relative humidity drops below 45%. This action minimizes ignition risk but creates a new regulatory and customer service challenge: planned outages.

The increasing frequency of these events-droughts, high winds, and tropical cyclones-is the primary driver for a massive increase in capital expenditure (CapEx). Total CapEx for 2025 is expected to be approximately $400 million, with a projected increase to between $550 million and $700 million in 2026, largely to address climate resilience.

Need for substantial investment in vegetation management and wildfire risk reduction.

The company's 2025-2027 expanded Wildfire Safety Strategy is a multi-year, multi-million-dollar commitment to mitigating fire risk. The total cost for this three-year blueprint is projected at $350 million, with a specific budget of $137 million allocated for work in the 2025 fiscal year.

This investment is split between capital projects (two-thirds) and operations/maintenance (one-third). The O&M portion funds critical vegetation management, including the trimming and removal of thousands of hazardous trees, while the CapEx covers physical grid hardening. Over half of the total three-year spend, about $180 million, is focused specifically on Maui County, the area with the highest wildfire risk.

• Deploy covered conductors in high-risk areas.
• Install new weather stations and AI-enabled cameras.
• Replace and strengthen thousands of poles and equipment.

Focus on climate adaptation strategies for critical infrastructure near sea level.

Beyond wildfire, sea level rise and coastal flooding pose a long-term, irreversible risk to HE's low-lying infrastructure, including substations and transmission lines. The Public Utilities Commission (PUC) approved the 5-year, $190 million Climate Adaptation Transmission and Distribution Resilience Program.

This program, which includes $95 million in federal Infrastructure Investment and Jobs Act (IIJA) funding, is a foundational step in fortifying the grid against chronic flooding and storm surge. The initial phase includes the strengthening and replacement of over 2,100 poles on critical circuits. Planning benchmarks for critical infrastructure now consider 6 feet of sea level rise by the end of the century, which defintely requires a complete re-evaluation of asset placement.

Here's the quick math on the near-term environmental financial commitments:

What this estimate hides is the sheer execution risk in managing both the legal crisis and the energy transition simultaneously. That's a huge lift.

So, your concrete next step is this: Finance/Strategy: Model a worst-case scenario where $500 million in grid hardening costs are disallowed by the PUC, and assess the impact on the 2026 capital budget by the end of the month.