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Fuel surcharge decrease starts Aug. 1
GUAM Power Authority consumers will see their power rates go down starting Aug. 1 after the Public Utilities Commission approved a proposal last night to adjust the Levelized Energy Adjustment Clause, or LEAC, a fuel surcharge included in consumer power bills.
“We will be seeing a decrease in rates. We were proposing two options. One was for 19.206 cents per kwh (kilowatt hour) and the alternative was for 18.632 cents per kwh. There will be a reduction of about 2 percent on your total bill – very close to a $5 decrease that was recommended,” GPA General Manager Joaquin C. Flores told Variety in an interview after the meeting.
Flores explained: “We do this on a six-month basis. We look at our consumption every 6 months and essentially come up with the LEAC rates that are fixed for the entire period. For this period, fuel prices are somehow less than the previous period, for the last six months. Thus, there is a corresponding decrease in the fuel surcharge.”
Meanwhile, PUC also approved a petition put forward by GPA on its utility services contract with the U.S. Navy. With the approval of the new 10-year contract, GPA will be earning approximately $70 million per year, or at least $700 million in 10 years, as the island’s sole provider of the energy requirements of the U.S. Navy.
In addition, the new contract will allow the transfer of approximately $130 million worth of assets from the U.S. Navy to GPA. These assets include substations, power lines and pipe lines, among others, according to Flores.
Flores said this is a reaffirmation of the previous agreement made by GPA with the U.S. Navy back in 1996.
“With regard to the conveyance of those assets, some are still subject to environmental studies so we need to ensure they comply with federal quotes and standards. Before we take title to them, they have to go through a clearinghouse of different requirements, including very strict environmental requirements,” he added.
Flores concluded: “There’s an acknowledgement that GPA is the sole provider of energy and power requirements for the island and the Navy wants to continue that relationship in line with GPA’s performance and capabilities to provide safe and secure power for their mission.”