The state Public Utilities Commission approved a plan yesterday that would sever the amount of profits that Hawaiian Electric Co. earns from the amount of electricity that it sells, in a move aimed at accelerating the adoption of clean energy resources.

Known as revenue decoupling, the proposal is a key part of Gov. Linda Lingle’s Hawaii Clean Energy Initiative. Advocates say it will encourage energy conservation and will stabilize HECO’s revenue stream. Currently, HECO’s 400,000 customers are charged based on the amount of electricity they use.

Under decoupling, HECO would receive guaranteed annual revenue to cover its fixed costs, not including fuel and taxes. Rates will vary depending on usage. If usage goes down, consumers will have to pay higher rates per kilowatt-hour to keep HECO’s revenue stable. But HECO said that decoupling, by spurring increased use of renewable energy, could result in lower fuel costs in the long run.

The 136-page document was approved by a 2-1 vote, with PUC Chairman Carlito Caliboso and Commissioner John Cole voting in favor. Commissioner Leslie Kondo dissented, writing that decoupling unfairly insulates HECO from economic and business risks by guaranteeing HECO’s revenues and shifting those risks to HECO’s customers.

"Clearly, as a result of the majority’s decision, customer bills will go up," Kondo wrote. "It appears likely that low-income, fixed-income and elderly customers will feel the greatest impact from decoupling and that those customers have the least ability to reduce their electricity use."