Dive Brief:

NextEra Energy has agreed to acquire Hawaiian Electric Industries (HEI), parent company of the Hawaiian Electric utilities, in a transaction valued at about $4.3 billion, according to a release.

NextEra will assume $1.7 billion debt from HEI, which is also spinning off its banking subsidiary, American Savings Bank.

Excluding debt and the spinoff, the deal values HEI at $2.6 billion​ according to Bloomberg . That comes out to below the $28.19 it was trading at Wednesday's close.

Dive Insight:

Hawaiian Electric is a rare bird in the utility industry. That's because the state's energy landscape is unlike any other in the country. The state has the highest electricity prices in the country, largely a result of the islands' dependence on imported fuel oil. Because of these high prices, it is the only state where solar plus storage is cost-competitive with the grid. Solar penetration in Hawaiian Electric's service territory is already over 10%—the feared tipping point at which many in the industry believe utilities will start to see truly significant grid integration and business model challenges.

The Hawaii PUC told Hawaiian Electric in the spring that its current business model does not align with public policy goals and the needs of Hawaii's electricity customers. In response, Hawaiian Electric has proposed getting 67% of electricity from renewables by 2030.

So, with all these challenges, why does NextEra want to buy the Hawaiian Electric companies?

The acquisition of HEI offers NextEra Energy an intriguing and immeasurable benefit: the opportunity to use Hawaiian Electric as a guinea pig to solve those problems—well before they hit the mainland. High levels of renewables and distributed resources are a challenge that many utilities are starting to deal with across the country, but only Hawaiian Electric—and perhaps the California investor-owned utilities—is experiencing it in full right here, right now.

UPDATE: When reached for comment by Utility Dive on Thursday morning, NextEra Energy spokesman Steve Stengel said the idea that Hawaiian Electric could be used to test grid integration and business model solutions was "interesting."

Stengel added that Jim Robo, NextEra's chairman and CEO, "was asked that exact question yesterday," but "he did not frame it that way." Robo instead framed Hawaii's energy challenges as unique, adding that the ultimate solutions would also be unique to the state, according to Stengel.

"We think that we have some skills that we can bring to bear that will help Hawaiian Electric meet their goals and objectives [to integrate more renewables and lower customer bills], and we actually think we can help them accelerate some of the things they want to do," Stengel told Utility Dive. Smart grid, smart meters, energy storage, wind, solar and distributed generation "are all things that are in our wheelhouse, all things that we do today."

NextEra already owns Florida Power & Light, the largest regulated electric utility in Florida, and NextEra Energy Resources, one of the biggest renewable developers in the U.S.