CPUC tables large commercial incentive rate proposal

What could’ve given the Commonwealth Utilities Corp. a boost in sales due to an experimental incentive rate for large commercial customers to return to CUC’s grid has been tabled once again.

“I ask that the Commonwealth Public Utilities Commission table the experimental tariff rider incentive rate because we need the input and comments of large commercial customers before approval,” said CPUC hearing examiner Harry Boertzel.

All three CPUC commissioners voted to hold off the contract for further review by potential large commercial customers by the end of this month.

“Before we can approve this, Boertzel’s recommendation is to have the large commercial customers review the contract and proposed incentive rate net benefit so that we can reach a decision by the end of this month,” CPUC chair Joseph Guerrero said.

CUC consultant, economist.com managing director Robert Young, was concerned, however, over the amount of time CUC and CPUC has already invested in coming up with the proposal.

The standby charge was among the rate petitions CUC filed with the CPUC in July last year; it was supposed to be implemented in October 2013. The proposal was snagged by delays in succeeding months and was eventually withdrawn by CUC’s new board on April 14, 2014.

At the time, CUC’s then-chief financial officer Charles Warren said that CUC, CPUC, Georgetown Consulting Group, economist.com, and large commercial customers were working on an introductory rate.

Consultants for both CPUC and CUC had approved a modified incentive rate for CUC’s existing commercial rate and required CUC to submit a contract by July 31, 2014. After some initial concerns were ironed out, Georgetown recommended the new rate for approval on Thursday last week.

The proposed contract will cover large commercial customers locating, expanding, or returning their entire load to CUC’s distribution system on all three islands in the CNMI.

Customers availing of this incentive rate must agree to remain full CUC customers for the four-year duration of the IR term.

The contract is also open to new participants for a window of four months from the time it is approved.

Commercial customers are qualified for the new rate if they have a generation capacity of 400kW or greater and generating 90 percent or more of their annual electric needs; commercial customers that expand their existing facility that results in an increase in load of 200kW or greater or expand their hotel by 75 rooms or greater; or new commercial customers with electric generation capacity of 400kW or greater.

The four-year incentive rate will provide a reduction of 8.3 cents per kWh from CUC’s commercial electric base rate from the date the customer starts purchasing electricity.