Wednesday, April 9, 2008
By Raymond A. Martinez
Variety News Staff
THE Commonwealth Utilities Corp. has increased its electric fuel rate this month for its commercial, government, and non-conforming load customers.
Based on CUC’s April schedule of electric charges and rates, the electric fuel rate for commercial, government, and non-conforming load was raised to $0.327 after the cost of fuel per barrel reached $132.
CUC said last month the fuel cost was between $110 and $120 per barrel.
The $0.327 is applied to all kilowatt-hour electric usage of non-residential customers.
Currently, the total rate per kilowatt hour for commercial customers is up from last month’s $0.374 to $0.413.
The total rate per kilowatt hour for government customers is up from $0.379 to $0.418.
The total rate per kilowatt hour for non-conforming load customers is up from $0.510 to $0.549.
Non-conforming load refers to CUC’s Tinian customers which include the International Broadcasting Bureau.
CUC said the monthly charge and the electric non-fuel rate are still fixed at their old amounts.
The electric non-fuel rate for commercial is at 0.086, government at 0.091, and con-conforming load at 0.222.
The electric fuel rate for residential customers still remains at 17.6 cents per kilowatt hour, pursuant to Public Law 15-94 which lowered the ceiling rate of electric fuel from 25.3 cents per kwh.
CUC Executive Director Anthony C. Guerrero earlier said that they were only able to purchase 11,000 barrels of fuel from Mobil due to lack of funds.
CUC could pay only $1.5 million for the fuel delivery, short of 14,000 barrels to operate its power plant facilities for one month.
Press Secretary Charles P. Reyes Jr. said, “We are still addressing the issue. It is a very difficult matter.”
Sunday, December 30, 2007
Power crisis reveals lingering CUC woes
Faced by recurring blackouts stemming from a lack of fuel supply and owing to the Commonwealth Utilities Corp.'s rock bottom cash situation, Gov. Juan N. Babauta declared a state of emergency on utilities during his State of the Commonwealth Address on May 19 this year.While the intention was considered noble-which was to ensure a stable power supply-the governor's declaration was much criticized, especially by the political opposition, since his action attested to the severe financial crisis of the government, on the face of his much-parodied insistence that the state of the Commonwealth was “still pretty darn good.”The declaration lasted not for a month or two but seven whole months, or just weeks before the end of the governor's term. Meantime, immediately following the emergency declaration, which placed the entire CUC under the direct supervision of the governor, the government obtained a commitment from CUC's lone fuel supplier, Mobil Oil Marianas, to deliver a month-long supply of fuel.At the same time, negotiations between the government and Mobil continued for a long-term fuel supply contract.This negotiation, headed by Lt. Gov. Diego T. Benavente and governor's advisor Adam Turner, culminated with the signing of a two-year contract with Mobil in early June 2005, amounting to at least $60 million.Mobil's previous contract with CUC expired on April 30.Due to CUC's pitiful fiscal condition, it could not arrange for another contract with the fuel company by itself.Then CUC executive director Lorraine A. Babauta cited that the rising cost of fuel has taken its toll on CUC, and the governor was needed “to step in and assist in any way possible to make sure that a fuel contract is executed at the earliest possible time.”“That's basically what's been keeping us from moving forward,” the CUC official had said.She cited that CUC fuel costs have risen from $30 million annually to $60 million in 16 months.REPROGRAMMING With the emergency declaration came the reprogramming of funds and the hiring of “consultants” to arrest the power crisis, which was later discovered to be caused not only by the lack of fuel but the neglect and poor maintenance at CUC's power generation plants in Lower Base.From May 19 to October 2005, the governor reported the reprogramming of some $5.1 million in local funds and $2.6 million in federal funds. Later, the governor said that the Marianas Public Lands Authority had also chipped in by reprogramming $1 million for CUC.Recently, CUC reportedly said that it received an additional $1 million from the administration. It was expecting some $500,000 from the administration as of last week.LEGISLATURE OKS REPROGRAMMINGA week after Babauta declared the emergency, the House of Representatives, headed by opposition Speaker Benigno R. Fitial adopted House Joint Resolution 14-36, granting the governor 100 percent authority to reprogram any available local funds to remedy the power crisis.The measure, which was introduced by Fitial himself, also passed the Senate shortly.“The Legislature supports the governor's declaration of state of disaster emergency. It is the intent of the Legislature to authorize the governor 100 percent reprogramming authority from available Commonwealth funds to remedy the power generation problems,” reads part of the resolution.The resolution, however, prohibited the governor from entering into any public debt without the approval of the Legislature, as provided in the CNMI Constitution Article 10, Section 3. This came about after learning that the Executive Branch and CUC entered into a $10-million letter of credit with the Bank of Guam following the May 19 emergency declaration.Babauta said, though, that the standby letter of credit with BoG is not public indebtedness, pointing out that CUC is a semi-public corporation that has its own assets. In the end, the administration said Mobil's new contract incurred no new long-term credit with the bank.It said that the new fuel contract called for a cash guarantee to Mobil of $7.5 million. This guarantee was made by securing CUC funds that were “already in the Bank of Guam” against fuel purchases.Authorities said the CUC has some $9 million in restricted funds at BoG.NEGLECTED GENERATORSAfter the fuel contract was secured, CUC's Lorraine Babauta revealed that the maintenance of engines “also remains a serious issue.”She said in early June that renovation and other improvements on existing engines would cost over $2 million.KUMOI'S CONTRACTExpressing possible abuse of authority under the emergency declaration, the political opposition revealed that CUC had entered into consultancy contracts with former senator and former CUC executive director Ramon “Kumoi” Guerrero and California-based electrical engineer Roger Kitchingham to fix CUC's engines.Initial documents showed that CUC approved a $21,000-purchase order for Guerrero and a $20,000-agreement for Kitchingham for the repair of CUC power plant II, which is adjacent to the main power plant, Power Plant I.Before this, Guerrero had secured a separate $50,000-consultancy contract with the Governor's Office for the La Fiesta complex.The former senator's entry as Babauta's consultant during an election year was put under close watch since he was previously associated with the opposition, particularly with Fitial. “We need to watch carefully to make sure that what is actually done is in the best interest of taxpayers and public utilities, and not patronage or political maneuvering using taxpayers' funds,” Fitial's spokesman, Charles Reyes, had said.But the opposition only had to wait for a little time as Guerrero's power plant consultancy was not for long.On Aug. 1, shortly after finishing his contract or the non-renewal of it, Guerrero was the guest of honor at a House panel's public hearing, lashing out at CUC's “incompetence” in handling the power generation business.Guerrero expressed his anger over Attorney General Pamela Brown's so-called interference, which he said was causing the delay in the repair of engines.The AGO refuted this, alleging that it was Guerrero who tried to manipulate CUC and overlook procurement rules to sole-source contracts.FUEL SURCHARGEThe Legislature, initiated by the House leadership, moved to repeal the fuel surcharge fee, which the CUC had imposed effective March this year on all CUC customers.The measure, House Bill 14-343, authored by Vice Speaker and former CUC executive director Timothy Villagomez, aims to repeal the law, 4 CMC section8148 (b) , which gives the CUC board the authority to impose up to 3.5 cents fuel surcharge per kilowatt hour.Despite public clamor for its repeal, Gov. Babauta vetoed the bill, retaining the fuel surcharge.Before this, the governor asked the Legislature to appropriate funds for CUC if it wants the bill enacted into law. Babauta said that while he sympathized with consumers, he said that removing the fuel surcharge without an alternative fund would mean the collapse of the local utility firm.He challenged the Legislature to appropriate $31 million to let CUC buy fuel to run the power plants in the next 15 months, appropriate funds to pay CUC debts (amounting to some $18 million), and appropriate funds for government utilities.The Legislature only appropriates $5 million for utilities annually. The government, however, paid a total of $12 million to CUC as of early September 2005.PRIVATIZATIONDuring the emergency, CUC also pursued the proposed privatization of power generation.As of July, CUC privatization consultant, Dennis Swann of Harris Group, said that a privatization contract would be signed in less than two months. This, however, did not materialize following a financial audit review of two proposers: Telesoure and Rolls Royce.After the Nov. 5 elections, the governor, likewise, echoed the position of the Saipan Chamber of Commerce that it was impractical for the CNMI government to commit itself to a 20-year privatization program in view of skyrocketing oil prices.He also said that in 20 years, there may be a cheaper alternative to fuel.The privatization called for the takeover of the eight-engine Power Plant I in Lower Base, its rehabilitation and upgrade to meet environmental standards, and installation of two new 15MW generators. The contract would allow the private company to operate the machines for 20 years.HOUSE OPPOSES REPROGRAMMING After three months of continued emergency, the House of Representatives changed its position on the reprogramming of funds for CUC. In a resolution, the House now accused Babauta of illegally reprogramming funds to CUC.The House demanded that the governor submit to the Legislature a complete financial analysis of his alleged illegal diversion of funds.The House also asked the Office of the Public Auditor and the Attorney General's Office “to investigate the illegal use of public funds by the governor.”These demands are contained in House Joint Resolution 14-42, which the House adopted during its session in early September.It cited that, under the law, 1 CMC subsection 7402 and 1 CMC subsections 7302 and 7403, “no funds may be reprogrammed, and no obligation or contract for the expenditure of Commonwealth funds shall be made for any purposes other than the public purposes for which the funds are appropriated.” It said that the law also provides that “no Covenant funds may be reprogrammed or otherwise transferred or borrowed from capital improvement and economic development accounts to government operational accounts.”It further said that the governor is only allowed by law to reprogram up to 25 percent of funds appropriated by the annual appropriation for the operations of the government.Any reprogramming that exceeds the 25 percent limit shall be subject to prior approval by the Legislature, the House said. Press secretary Peter A. Callaghan countered this by saying that the governor could have not done any illegal reprogramming because he has that authority under an emergency situation.Further, he said that the Legislature gave him 100 percent reprogramming authority to address the CUC power crisis. EMERGENCY ENDEDOn Dec. 13, the governor announced his decision to end the seven-month state of emergency and return the management of CUC to its board of directors effective Dec. 16.Without the state of emergency, the Governor's Office will no longer have the authority to reprogram funds from other government services to subsidize CUC's fuel purchases and other expenses.Two tankers are due to deliver power generation fuel on Jan. 8, 2006, requiring about $6.8 million in payment from CUC. The governor said that the government could raise only up to $2.5 million for CUC by end of December.Babauta's last day in office is this Friday, Jan. 6. His political opponent, Gov.-elect Benigno R. Fitial, will be inaugurated on Jan. 9.Babauta believes that, under his last trying year in office, he managed to rescue the CUC power plants from near collapse.He said the Commonwealth “is no longer threatened by a catastrophic collapse of the utility system.”Right now, CUC generates approximately 68 megawatts of power, just enough to meet peak demand. By design, Power Plant I has a capacity of 81.2MW, Power Plant 2 has 15MW, and Power Plant 4 in Puerto Rico has 17.5MW.Power plant 3's three engines, which have a capacity of 4.5MW, are all currently down.CUC plans to revive Power Plant 3 and relocate it from the airport area to the main power plant in Lower Base.
Sunday, November 25, 2007
THREE other La Fiesta Mall copper wire suspects have been arrested and were brought to Superior Court last week.
Associate Judge David A. Wiseman signed a seal order on two of the suspects on Friday afternoon.
Only the case of Jeff C. Magofna, 26, was not sealed.
He and the two other suspects were arrested on Thursday and brought to court for a bail hearing on Friday afternoon.
Magofna and the two other suspects were remanded to the custody of the Department of Corrections after the hearing.
The three were ordered to appear in court for a preliminary hearing on Nov. 30 and arraignment was set for Dec. 3.
The identity of the suspects was revealed to the authorities when their co-defendant, 18-year-old John Santos Jr., was arrested on Tuesday after he was caught at the La Fiesta III building in San Roque with individuals who were loading copper wire into a pickup truck.
Santos, the son of Department of Public Safety Boating Safety commander Sgt. Bernard Santos, was placed under house arrest and released from custody through a third party custodian.
The government said Santos cooperated with the ongoing investigation and identified the individuals as Magofna and the two other suspects.
Magofna was arrested for criminal mischief and theft.
DPS stated that a police detective was doing a routine patrol at the La Fiesta III building in San Roque on Tuesday at 1 p.m. when he saw a green Toyota pickup truck parked near the building and two men loading rolls of copper wire into the bed of the truck.
When the officer approached them, two suspects fled on foot along with another suspect who had been in the building.
The responding officer was able to detain the fourth suspect, John T. Santos, who was acting as a lookout.
Police discovered that an undetermined amount of copper wire had been cut from the former shopping mall.
DPS said they recovered 15 rolls of copper wires from the truck.
Saturday, November 24, 2007
I KNOW I have some explaining to do here, but I am an elected public servant and part of my elected duty is to ensure that I provide such accurate information and I can when going public with my opinions.
First, I am trained to listen, and I accept criticisms as a public servant, and I will engage in any retaliatory mode of public criticism because I know that if I make mistakes, I will humbly accept responsibility and try to correct them. However, I will react and respond to any unreasonable, unjustifiable and unfair accusations, in order to enlighten the truth of the matter and not contribute to misinformation and confusion in the community.
Therefore, let’s clear the record here so the people can get the benefit of accurate public information in order to make some good judgments.
Let me take you, Mr. Guru Cruz, back to Oct. 3, 2007, when you and members of the Taotao Tano were sitting in the House gallery anxiously waiting for us to override the governor’s veto of House Bill 15-246. Like you stated in one of your news articles, when you claimed that it was the Taotao Tano’s insistence that the Legislature overrode the governor’s veto, yes, we all were united on this issue and wanted the override because we all felt it was necessary for the people.
Let me also remind you in case you have forgotten that the House unanimously voted for the override with 16 voted yes and 2 members absent. The Senate then overrode the same veto on Oct. 4, 2007 in Rota with 8 members voting yes and one member absent. Of the 27 members of both houses in the 15th Legislature, 24 voted for the override, and this override included your voice for the people, many CNMI residents, and the rest of the Taotao Tano. If what you said is true that your association represents the voice of the people, then this is a testimony that this override was necessary and was the right thing to do for the people. Please try to keep yourself focused on what and how things transpired, and then decide where you stand. You can’t be in two places at one time.
Furthermore, please note that the current proposed increase in the electric rate by the governor, is the emergency regulation proposed to be implemented by the “Customers Using Candles,” also known as CUC. The governor did not invoke his emergency power like you claimed in your letter. But even so, this proposed emergency regulation is still in violation of Public Law 15-94. But of course, with all the legal scientists in the governor’s office, he will still disagree with us. Then he will continue to publicly profess that he is very much willing to work with the Legislature, like Charles continues to repeat himself. This will be a good definition of your favorite word, DECEPTION.
Mr. Cruz, I firmly believe that the best possible way that we in this poor CNMI can solve some of our problems and move forward toward economic recovery is when we have peace among ourselves and work together in unity and harmony. I want you to know that the newly elected Republicans are trying to do just that. We have a consensus that the hard working Minority Leader Rep. Arnold I. Palacios will be our next speaker for the 16th Legislature. Even the Honorable Rep. Stanley Torres happily consented to this choice. So please try not to disrupt this peaceful process. Please try not to single out people in your praises or accusations because I believe we’re all in this together whether you like or not.
By the way, I wonder why are you guys so obsessed with only the Legislature? Don’t you think everyone is equally responsible in the quest to find solutions to our problems? You are beginning to sound like T.H. & A. the other three Goros, duh. Please quit contributing to the glory of, you know who.
Greg, I don’t know if you realize that you have tremendous leadership potential. You probably won’t believe it but people are talking all over the island about how much potential you have. But they strongly recommended that you learn the Art of Listening to more realistic advice so that you may nourish and nurture your potentials. Try to be more discrete and prudent in your choice of words. You will begin to realize that you are more mature and diplomatic, and by the time the year 2009 kicks in, then you’re good to go. Don’t forget that you are a public figure. See you later. Oops, don’t forget to take the P.I.O. with you.
REP. CANDIDO B. TAMAN
Capital Hill, Saipan
Friday, November 23, 2007
SAIPAN residents marked Thanksgiving yesterday with the return of two-hour rotating blackouts because the Commonwealth Utilities Corp. could not produce enough electricity.
CUC said one of its major engines is down and the situation could go on indefinitely if the cash-strapped government fails to come up with enough funds to buy fuel for the power plants.
Anthony Guerrero, CUC’s executive director, said with fuel now going for close to $100 a barrel, the CNMI has to pay even more because of its remote location.
Mobil Oil sells diesel fuel to CUC at $105 per barrel, according to CUC spokeswoman Pamela Mathis.
She said the damaged 7-megawatt engine no. 2 at power plant 1 remains down.
“It hasn’t gotten any better,” she said, adding that it will take several days before the engine is back on line. “We started the load shedding (on Thursday) at 11:30 a.m. It will go on until further notice.”
The next fuel delivery for CUC is scheduled for next week.
Guerrero said although CUC will start charging residential customers higher rates through the emergency regulations implemented on Nov. 2, they won’t be able to get that revenue until next month.
“The revenue from that emergency regulation won’t be realized until the first billing cycle in December. We have another tanker before the end of the month,” he said.
“We’re concerned because between now and the tanker arrival, the revenues from the reduced rates are what’s coming in on our billing process. And as we’ve said before, it’s reduced revenue and so we will be going to the governor and asking him to cover whatever shortfall we have,” he added.
Mobil delivers fuel from Singapore to CUC every 22 days.
Mathis said CUC has notified Finance Secretary Eloy Inos about the situation.
She said the governor is not allowed to reprogram funds for CUC because it is an autonomous agency.
Guerrero said CUC is now awaiting the governor’s decision on its request for fuel subsidies.
“We basically asked for assistance from the governor. As to how the governor will provide that assistance to CUC, whether that will require that he again institute a state of emergency, that will be for the governor and his advisers to decide,” he said.
The load shedding schedule for Saipan is as follows:
• 11:00 – 1:00 Kiya Two - Second Partial of the Grid At the Mobil Gas Station in Koblerville, Afetna, San Antonio, and Chalan Piao.
• 1:00 – 3:00 pm Feeder One – Lateral Streets within Partial of the Grid The Anaks Condos, China Town, DFS (and the street behind DFS) Mariana Heights Business Complex
• 3:00 – 5:00 pm Feeder Two - Second Partial of the Grid Along Beach Road in Garapan from Kristo Rai to Chalan Laulau
• 5:00 – 7:00 pm Kiya Four North Chalan Kanoa (post office and main streets from Saipan Community School)
• 7:00 – 9:00 pm Feeder Four - Second Partial of the Grid Capitol Hill on the 1200 Block, Homestead area, Talafofo, As Teo, Papago and Kagman I, II, III. • 9:00 – 11:00 pm Feeder Seven Lower Base industrial area, north to Tanapag, Achugoa, San Roque, and As Matuis to Marpi.
Wednesday, November 21, 2007
A POWER outage occurred again for the nth time on island without announcement shortly after 5 p.m. yesterday because one of the engines at the main power plant malfunctioned.
The power went back after an hour in some areas as of press time but it might go on for sometime in Capital Hill area, according to Commonwealth Utilities Corp. spokeswoman Pamela Mathis.
She said the 7-megawatt unit no. 2 at power plant 1 was taken offline because water was leaking into its oil system.
CUC will extend the emergency blackout to areas where there is less traffic if the need arises, she added.
“We’re really trying to maintain power at all traffic lights (for safety reason),” she said.
st- Nov 21, 2007 By Ferdie de la TorreReporter
Outage hits Kagman
As rain, winds damage power wires, equipment
Kagman experienced an outage yesterday afternoon when the Commonwealth Utilities Corp. conducted repairs on the electrical wires and equipment that were damaged during Monday's strong rain and winds brought by a trade-wind disturbance.CUC linemen turned off the electric power in Kagman after school or at 3pm as they made the repairs.CUC spokesperson Pamela Mathis said electricity will be restored as soon as the lines are clear of danger.Mathis underscored the need to conduct such repairs before major power failures occur.In addition to Monday morning outages in southern Saipan, CUC also fixed damaged equipment in Dandan, Capital Hill, As Matuis, and Koblerville.A number of trees fell on high voltage lines and took the lines down in several locations during the heavy rains.There were isolated minor outages yesterday as CUC field crews made repairs.Mathis issued the following safety measures for the public to observe during heavy rains:- Customers and children should never touch a fallen power line and always call for help. Electricity may still flow through downed lines.- Parents should not allow children to play in wet trees that are anywhere near high voltage lines because the electricity can also flow through wet vegetation.- If power lines fall on vehicles, stay inside the car-never get out until the CUC personnel advises that it's safe.- Any time a home floods or fills with water, unplug all appliances or cords along the floors or baseboards.
TAOTAO TANO UPDATES
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FLASH BACK 2006
CONSUMERS OPINION ON CUC
WHAT IS RISING OUT IN THE COMMUNITY
HEAR WHAT CUC HAS TO SAY
- MV 121007 - Administration takes over CUC, again
- 120607 mv - Falling trees cause islandwide blackout
- 120507 mv - CUC will again charge record-high power rates this month
- 113007 mv -CUC short by $2.5M for fuel payments
- 112907 mv -4 power generators still down
- 113007 mv - Only 3 engines running at main power plant
- 112207 mv- Emergency blackout hits Saipan