Proposed water rate hike fails Kapalua

Hawaii Public Utilities Commission weighs critical decision on water bills

Published on Feb. 11, 2026

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The Hawaii Public Utilities Commission (PUC) is currently considering a rate increase request from Hawaii Water Service (HWS) that would significantly raise water bills for residents and businesses in Kapalua. The proposal includes a 'Watershed Purchase Rider' that would allow HWS to pass on 80% of the potable water costs and 43% of irrigation water costs to customers without PUC oversight, effectively transforming HWS into a pass-through for an unregulated private water supplier.

Why it matters

This rate increase proposal undermines the PUC's regulatory authority and the principle of fairness for customers. If approved, it would allow an unregulated third party to effectively set the price for a public necessity without any oversight or transparency.

The details

HWS is requesting to raise potable water rates from $3.53 to $7.64 per unit, with $6.18 (80% of the new rate) going to the private, unregulated water supplier. For irrigation water, the increase is from $2.22 to $5.28, with $2.30 (43%) paid to the same private supplier. This structure shields the expenses, finances, and profits of the private water supplier from PUC scrutiny.

  • The Hawaii Public Utilities Commission (PUC) is currently weighing this critical decision.

The players

Hawaii Public Utilities Commission (PUC)

The state regulatory agency responsible for overseeing utility rates and services, including water.

Hawaii Water Service (HWS)

The regulated water utility that has requested the rate increase and 'Watershed Purchase Rider' from the PUC.

Private, unregulated water supplier

The entity that would receive the majority of the proposed rate increase without any PUC oversight or regulation.

Gary Grube

The owner of Hua Momona Farms in Kapalua, Maui, who wrote the editorial criticizing the proposed rate hike.

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What they’re saying

“As a business person, I understand the need to make a reasonable profit; however in addition to the requested rate increase, HWS is asking for a so-called 'Watershed Purchase Rider.' This rider is problematic because it will allow a special added charge on our regular water bills, which appears to be a way to pass on costs to the consumer, without any oversight or regulation from the PUC.”

— Gary Grube, Owner, Hua Momona Farms (Honolulu Star-Advertiser)

What’s next

The PUC has two options: deny the application or regulate the source of the water by bringing the private, unregulated water supplier under its jurisdiction.

The takeaway

This rate increase proposal undermines the PUC's regulatory authority and the principle of fairness for customers. The public must not fund a charge that is immune from oversight, and the PUC must either reject this flawed application or ensure the entire water supply chain is brought under full regulatory scrutiny.