The Hawaiian Electric Companies (“the Companies”) have asked us to provide advice on improving the incentive arrangements in their ratemaking procedures in connection with the Hawai‘i Public Utilities Commission re-examination of decoupling in Docket No. 2013-0141. The Companies also asked us to provide an overview of the theory and practice of incentivebased ratemaking (“IBR”) in energy regulation and to make recommendations as to how the Companies’ RAM, RBA and other aspects of ratemaking could be improved. The Companies also asked us to comment on various rate of return issues raised in Docket No. 2013-0141.