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An aerial image shows a red roofed house that survived the fires surrounded by destroyed homes and buildings burned to the ground in the historic Lahaina in the aftermath of wildfires in western Maui in Lahaina, Hawaii on August 10, 2023.

Patrick T. Fallon | AFP | Getty Images

Maui County on Thursday sued Hawaiian Electric for damages over the deadly wildfires that have claimed more than a hundred lives and resulted in billions of dollars in estimated property losses.

Hawaiian Electric’s stock fell 6% in extended trading on news of the lawsuit. The electric utility said it will suspend its quarterly dividend beginning in the third quarter to free up cash to help rebuild and restore power in the wake of the fires.

Maui County’s attorneys said Hawaiian Electric inexcusably left its powerlines energized despite a warning from the National Weather Service that high winds from Hurricane Dora and drought conditions on the island created a high fire risk.

The wildfires reduced the historic town of Lahaina to ruins in the deadliest blazes in the U.S. in more than a century and the worst disaster in Hawaii state history. At least 115 people have died and more than 1,000 are still missing.

Hawaiian Electric issued a statement on the day the fires broke out that 30 utility poles had been knocked down in West Maui, the region where Lahaina is located.

“These powerlines foreseeably ignited the fast-moving, deadly, and destructive Lahaina Fire, which completely destroyed residences, businesses, churches, schools, and historic cultural sites,” the county’s attorneys said in the lawsuit.

Maui County said the death and destruction could have been avoided had Hawaiian Electric shut the power off. The county cited initial estimates from the Federal Emergency Management Agency that it will cost more than $5 billion to rebuild Lahaina.

The complaint filed by Maui County is the latest in a string of lawsuits against Hawaiian Electric seeking damages for the catastrophic wildfires.

Fitch recently downgrade Hawaiian Electric’s credit rating to junk status, warning that the company faces an existential threat from more than $3.8 billion in potential liability for the Maui wildfires. Moody’s estimates the Maui wildfires have caused up to $6 billion economic losses.

Maui County also said in the lawsuit that its 2020 hazard mitigation plan warned that western Maui was at a high risk of wildfires. Hawaiian Electric understood this risk and filed a $190 million request in 2022 with the state public utilities commission to bolster its power grid, the county said.

Despite this, Hawaiian Electric operated utility poles made of wood which are far more prone to decay in Maui, the county said. Many of the wood poles on Maui were severely damaged by advanced decay which contributed to their failure during the high winds, the county alleged.

The county said that Hawaiian Electric also knew its overhead transmission lines did not use available technology to reduce the risk of fires.

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