Hawai'i families, who already are squeezing their budgets to cover record-high gasoline prices, may need to rein in spending even more to make up for recent increases in electricity costs.

The typical resident using 600 kilowatt hours on O'ahu this month paid $109.76, compared with $94.11 a year ago, a 16.6 percent increase, according to Hawaiian Electric Co. Almost all of that increase was due to a bump in the "energy cost adjustment," which is tacked on to monthly bills to cover higher fuel costs. The adjustment is at a five-year high of about $33 for the typical bill.

"Oh, my gosh, it's high," said Pearl City resident Judy Sumaoang, who paid $192 last month, up from about $130 a year ago.

The 53-year-old accountant recently started doing more to conserve energy. She and her husband put a timer on their water heater, cut back on using hot water and are cooling their home with a ceiling fan instead of an air conditioner.

Kahala resident Chris Hochuli also has been more vigilant about conserving energy and reducing his electricity costs. The 33-year-old financial adviser said his electric bill is about $50 higher than last year, even though his family's electricity usage has remained about the same.

"You're more cautious about running the air conditioner for sure," he said. "You're definitely paying attention to the lights on."

As with gasoline, Hawai'i residents pay some of the highest electric rates in the country, according to the U.S. Department of Energy. Hawai'i's average residential retail price in May was 19.87 cents per kilowatt hour, or more than double the national average of 9.53 cents per kilowatt hour.

Rates among the counties vary. O'ahu had the lowest overall rate in August at 17.13 cents per kilowatt hour, followed by Maui at 23.56 cents and the Big Island at 26.8 cents. Kaua'i residents are paying the most at 29 cents per kilowatt hour.

While base electricity rates in the state have remained constant for customers for the past several years, the surcharge added for rising fuel costs has climbed dramatically in the past year.

"Because the electric companies here basically burn oil or products of oil to generate electricity, as long as the cost of oil is going to be rising, so will electricity rates," said John Cole, executive director of the state Division of Consumer Advocacy. "You can't force the electric company to eat it all, otherwise they'd end up not being able to provide the electricity that's needed.

"It's definitely a concern for me as a consumer advocate and a consumer. I have a family, I pay for my gas and my electricity. It's taking a bigger and bigger bite out of my paycheck just like everybody else."

Bank of Hawaii economist Paul Brewbaker said he doesn't see much relief from higher energy costs anytime soon, but he noted the economy has held up remarkably well in the face of skyrocketing oil prices.

"I don't see any relief, but I also don't see it as a death blow," he said. "It's a challenge to which households, businesses and government agencies should rise."

Both Brewbaker and Cole said the higher electricity rates should generate more discussion of how Hawai'i can reduce its dependence on oil-based power plants.

Residents need "to think through where further energy efficiency gains can be achieved and where more or new investments in alternative sources of electricity production might be implemented," Brewbaker said.

"As a consumer advocate," Cole said, "I want to do what I can to push things in another direction, whether it's with renewable type energy or being more efficient with what we do have."

Hawai'i power providers are allowed to pass changes in fuel costs on to consumers through the energy cost adjustment without seeking regulatory approval. Utilities are allowed to charge only enough to cover fuel costs, not to add to profits.

HECO said the energy cost adjustment charge goes up or down depending on the cost of fuel when it is used, and that the price of the refined fuel used for generating electricity on O'ahu doesn't necessarily reflect current crude oil prices.

"We buy long-term contracts and we store fuel," said HECO spokesman Peter Rosegg. "The high crude oil prices you see quoted in the news are actually prices on the futures market for the most desirable kind of crude oil. They are not necessarily reflective of what someone who buys less desirable crude oil long term for delivery would be paying at that particular month. So there's sort of a lag. Prices do not move in perfect parallel."

Rosegg also said the O'ahu utility primarily uses residual low-sulfur fuel oil, which is left after higher valued products such as jet fuel and gasoline are refined from crude oil. The low-sulfur fuel oil market is less competitive so prices have not risen as much as other types of fuel.

But Neighbor Island utilities rely mostly on diesel, which can be more expensive and must be shipped from O'ahu in relatively smaller amounts.

In addition to the fuel cost adjustments, HECO proposed earlier this year a 7.3 percent increase in its base rate. If approved, that would increase a typical residential electric bill by $6.51 a month. It is the first rate increase request by the company since 1995. HECO has said the higher rate, expected to bring in more than $74 million in additional revenue, is necessary to meet growing electricity demands across O'ahu.

The rate increase requires the approval of the Public Utilities Commission, which has set Sept. 13 to begin hearing the positions of HECO, the state Division of Consumer Advocacy and other parties on the issue. The commission is expected to make at least an interim decision by the end of the year.

Reach Lynda Arakawa at larakawa@honoluluadvertiser.com.