Pasha can offer intra-Hawaii service

Pasha can offer intra-Hawaii service    Hawaii’s Public Utilities Commission has approved an application by Pasha Hawaii Transport Lines to operate on an interim basis between the ports of Honolulu, Kahului, Hilo, Nawiliwili, Barbers Point and Pearl Harbor.
   Since 2005 Pasha has operated a fortnightly roll-on/roll-off service using the Jean Anne between California and Hawaii with a standard rotation of San Diego, Honolulu, Kahului, Hilo and San Diego.
   Now Pasha plans to expand its interstate operations to include intrastate water carrier service for heavy commercial and military truck/trailer equipment, tracked vehicles, buses, automotive-recreational vehicles and other general cargoes, but excluding passengers, livestock and refrigerated cargo. It plans to provide regular fortnightly intrastate service to Honolulu, Hilo and Kahului, and also sought authority to make calls at Nawiliwili, Barbers Point and Pearl Harbor upon customer request.
   Existing intra-island carrier Young Brothers argued that given the state of Hawaii’s economy and the stagnant intrastate shipping market, Pasha would take away business from Young Brothers and deprive it from earning a reasonable return on its capital investments — noting that from 2005 to 2008, its rate of return ranged from 1.6 percent to 6.96 percent, well below the 10.76 percent to 11.06 percent rate of return authorized by the Hawaii PUC.
   Rather than fostering competition and more efficient inter-island water transportation service, Young Brothers argued Pasha’s entry into the market would be detrimental to customers and the public.
   Because Pasha is proposing to offer services for only certain routes and lines of cargo that are generally more profitable such as ro/ro service to Kahului and Hilo, Young Brothers contended Pasha was cherry-picking and would reduce Young Brother’s revenue by an estimated $1.48 million and force it to adjust other operations in order to earn a reasonable rate of return.
   Young Brothers said it might be forced to reduce subsidies or the frequency of service on high-cost routes to places such as Molokai and Lanai, or seek to reduce or eliminate its “island product” discount for local agricultural products, or petition the commission for an increase in its rates.
   But the state said it would allow Pasha to operate through the end of 2013, saying the service would “provide the state with additional intrastate shipping options” and allow the commission to “gather actual data and relevant information (as opposed to projections and estimates) from the parties to determine whether Pasha’s intrastate operation will cause undue harm to the existing intrastate shipping industry or the public interest.”
   The PUC said that if it determines at any time that Pasha’s intrastate service results in undue harm to Young Brothers’ existing service or the public, it has the right to impose conditions on Pasha or revoke its ability to operate within the islands. It said it would review the service and its impact after 2013. ' Chris Dupin