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Fitial OKs $3.4M CUC bailout bill
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Posted on Jul 21 2008
Gov. Benigno R. Fitial has signed into law a bill funding the Commonwealth Utilities Corp.’s temporary power deal and paying the agency’s debts to two contractors.
Under the bill approved yesterday, CUC will get a total of $3.4 million of the Marianas Public Land Trust’s income for the next two fiscal years.
CUC will use $1.5 million as down payment for Aggreko International, which CUC hired to bring in rental generators to Saipan. The balance will go to pay CUC’s debts, with $1.1 million going to Pacific Marine Industrial Corp. and $800,000 to Telesource CNMI.
PMIC runs Power Plant 4, which produces almost half of Saipan’s current power generation capacity. Telesource operates the power plant on Tinian.
“This new law provides much needed financial relief for CUC and puts the agency in a much better position to offer more reliable public utility services,” Fitial said in a statement.
“I am grateful to the Legislature for working with my administration to serve the best interests of the CNMI by helping CUC pay its debts and bring in additional power generation capacity to end the power outages,” he added.
The new law also requires CUC to return the MPLT money by paying rebates to residential consumers starting January 2009, at the latest. The $3.4 million earmark should be paid in consumer rebates over a three-year period.
Proponents of the legislation believe that CUC will be able to able to provide 24-hour power service once the rental generators are operational. They also argue that the availability of emergency power will buy CUC additional time to repair its engines.
Currently, CUC generates only two-thirds of Saipan’s power demand. Power Plants 1 and 4 produce a total of 27.2 MW, while the peak demand is 41 MW. Due to the lack of power supply, Saipan residents are plagued by at least two hours of power outage a day.
