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Oʻahu & Maui Businesses Face Increased Operational Disruptions and Repair Costs Due to Recent Flooding

·10 min read·⚡ Act Now

Executive Summary

Recent severe weather has resulted in significant power outages and visible flood damage on Oʻahu and Maui, impacting critical infrastructure and business operations. Businesses must assess and mitigate immediate risks while planning for longer-term infrastructure resilience and potential supply chain disruptions.

  • Small Business Operators: Expect prolonged operational downtime, immediate repair expenses, and potential loss of perishable inventory.
  • Real Estate Owners: Face property damage assessment and repair costs, with potential impacts on rental income and insurance claims.
  • Tourism Operators: Risk cancellations and reduced bookings due to accessibility issues and damaged infrastructure.
  • Healthcare Providers: Must ensure backup power for critical services and manage patient care disruptions.
  • Action: Critical infrastructure assessment and immediate mitigation strategies are required within 72 hours.

Action Required

High Priority

Power outages and flood damage require immediate attention for operational continuity and safety, and ongoing repairs will affect accessibility and service delivery.

Small business operators should conduct an immediate assessment of property damage and potential inventory loss within 72 hours. Simultaneously, initiate contact with insurance providers to file claims and explore temporary backup power solutions if primary electricity remains unavailable, aiming to restore essential functions within 7 days to minimize financial impact.

Who's Affected
Small Business OperatorsReal Estate OwnersTourism OperatorsHealthcare Providers
Ripple Effects
  • →Flooded infrastructure → Extended Power Outages → Disrupted Supply Chains
  • →Operational Downtime → Reduced Revenue & Increased Insurance Claims → Strain on Small Business Margins
  • →Damage to Electrical Grid → Increased Costs for HECO Repairs & Upgrades → Potential for Future Rate Increases
Dynamic street scene featuring the iconic Top of Waikiki restaurant in Honolulu's urban landscape.
Photo by Florian Süß

Oʻahu & Maui Businesses Face Increased Operational Disruptions and Repair Costs Due to Recent Flooding

Recent severe weather events have caused widespread power outages and visible flood damage across Oʻahu and Maui, necessitating an immediate risk assessment and mitigation plan for businesses. Hawaiian Electric (HECO) crews are actively engaged in repairs, with over 130 customers still without power on Oʻahu as of Sunday evening, primarily in Waialua, and 50 customers affected on Maui. The visible flood lines on homes in affected Oʻahu neighborhoods highlight the severity and potential for ongoing impact on infrastructure. Addressing this situation requires a proactive approach to safeguard operations, property, and customer relations.

The Change

Following heavy rainfall and subsequent flooding, Hawaiian Electric reported significant power disruptions on both Oʻahu and Maui. While restoration efforts are underway, pockets of the population, particularly on Oʻahu's North Shore, remain without electricity. The visible evidence of high floodwaters suggests the potential for damage to electrical infrastructure, substations, and distribution lines, which may lead to extended restoration times or require significant repairs. This event underscores the vulnerability of essential services to extreme weather and the cascading effects on business operations.

Who's Affected

This event has immediate and critical implications for several key business sectors throughout Oʻahu and Maui:

  • Small Business Operators (small-operator): Businesses in affected areas, especially those reliant on electricity for operations (restaurants, retail, services), face significant downtime, potential loss of perishable inventory, and immediate costs for assessment and repair of any flood damage to premises. The lingering effects of power outages can impact point-of-sale systems, refrigeration, lighting, and general operational capabilities. For businesses needing to resume operations quickly, securing backup power or alternative work locations may be necessary.
  • Real Estate Owners (real-estate): Property owners, landlords, and property managers in flood-prone zones must contend with assessing and repairing flood damage. This includes structural integrity, electrical systems, and potential mold remediation. Insurance claims processes will need to be initiated promptly. For commercial properties, reduced tenant operational capacity can lead to rent deferrals or disputes. Developers may face delays in project timelines if infrastructure access or construction permits are impacted by ongoing recovery efforts.
  • Tourism Operators (tourism-operator): Hotels, tour operators, and vacation rental businesses are directly impacted by power outages and potential accessibility issues due to flooding. Cancellations and reduced bookings are likely, especially if transportation networks are disrupted or if destination appeal is diminished by visible damage and disruptions. Restaurants and amenities within hotels may also be forced to close temporarily, affecting the overall guest experience and revenue. The reputation of affected areas for reliability could suffer in the short term.
  • Healthcare Providers (healthcare): Clinics, private practices, and medical facilities require continuous power for critical equipment and patient care. While many are equipped with backup generators, extended outages test the limits of these systems and can strain resources. Telehealth services may be interrupted if internet connectivity is compromised. The ability to access facilities for both providers and patients can also be affected by flooded roadways.

Second-Order Effects

This event is not isolated and will ripple through Hawaii's unique economic landscape:

  • Flooded infrastructure → Extended Power Outages → Disrupted Supply Chains: Damage to roads, ports, and electrical systems can hamper the movement of goods, leading to shortages of essential supplies for businesses and increased costs for both raw materials and finished products. This exacerbates existing challenges related to the Jones Act and inter-island shipping.
  • Operational Downtime → Reduced Revenue & Increased Insurance Claims → Strain on Small Business Margins: Business closures and reduced sales directly impact revenue, while repair costs and potentially higher insurance premiums (if not covered) further erode profitability. This can lead to difficult decisions regarding staffing and investment.
  • Damage to Electrical Grid → Increased Costs for HECO Repairs & Upgrades → Potential for Future Rate Increases: Significant damage to HECO's infrastructure will necessitate substantial repair and potential hardening investments. These costs are likely to be passed on to consumers and businesses through electricity rate adjustments over time, impacting overall operating costs for all sectors.

What to Do

Given the immediate nature of power disruptions and flood damage, businesses must take swift action to mitigate losses and ensure continuity.

For Small Business Operators:

  1. Assess Immediate Damage & Safety: Conduct a thorough safety inspection of your premises for structural integrity, electrical hazards, and mold potential. Do not re-enter if unsafe.
  2. Inventory Loss & Insurance Claims: Document any loss of perishable inventory or damaged equipment meticulously. Contact your insurance provider immediately to initiate claims processing. Understand your policy's coverage for business interruption and flood damage.
  3. Secure Backup Power: If power is still out and essential operations cannot cease, explore short-term rental of generators or identify alternative operational sites with reliable power. Small businesses should aim to have contingency plans for at least 48-72 hours of outage.
  4. Communicate with Stakeholders: Inform employees about work status, customers about operational changes or delays, and suppliers about potential impacts on orders. Transparency is key to managing expectations.
  5. Review Emergency Preparedness: For future events, update or create a business continuity plan that includes emergency contact lists, backup procedures, and communication strategies.

For Real Estate Owners:

  1. Prioritize Safety Inspections: Ensure all properties are safe for tenants and occupants. Address immediate structural or electrical risks.
  2. Document and Report Damage: Thoroughly document all flood damage with photos and videos for insurance purposes. File claims promptly.
  3. Coordinate with Tenants: Maintain open communication with tenants regarding repairs, potential rent abatements (if applicable and warranted by lease terms), and expected timelines for resolution.
  4. Plan for Long-Term Resilience: Consider implementing flood mitigation measures for vulnerable properties during the repair process, such as elevating critical electrical components or improving drainage. Inform property managers of any new safety protocols.

For Tourism Operators:

  1. Review and Manage Bookings: Proactively contact guests with upcoming reservations in affected areas. Offer flexible rescheduling options or cancellations to mitigate negative reviews and maintain goodwill.
  2. Assess Transportation & Access: Monitor road conditions and public transit disruptions that may affect guest arrivals and departures, as well as the ability of staff to reach their workplaces.
  3. Communicate Service Status: Clearly communicate to potential and current guests the operational status of your property, amenities, and any tours or activities. Highlight any temporary closures or adjustments.
  4. Liaise with Local Authorities: Stay informed about official advisories and recovery efforts in your area.

For Healthcare Providers:

  1. Test Backup Power Systems: Immediately verify that backup generators are fully operational and have adequate fuel reserves for extended outages.
  2. Secure Critical Supplies: Ensure an adequate supply of essential medications, disposables, and any temperature-sensitive items that rely on refrigeration, with backup power confirmed.
  3. Activate Communication Protocols: Execute emergency communication plans to inform staff, patients, and relevant regulatory bodies about any service disruptions or changes in operational capacity.
  4. Monitor Telehealth Infrastructure: Confirm the stability of internet and communication systems necessary for remote patient consultations.

Action Details

Small business operators should conduct an immediate assessment of property damage and potential inventory loss within 72 hours. Simultaneously, initiate contact with insurance providers to file claims and explore temporary backup power solutions if primary electricity remains unavailable, aiming to restore essential functions within 7 days to minimize financial impact.

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