Recall sought on rate hike petition

The Senate and House of Representatives yesterday appealed to the Commonwealth Utilities Corp. board to recall with finality its rate hike petition currently awaiting approval of the utilities commission.

Senate Public Utilities Transportation and Communications committee chair Sen. Pete Reyes (RI-Saipan) and House PUTC panel head Rep. Lorenzo Deleon Guerrero (Ind-Saipan) jointly addressed the CUC board yesterday to urge the body to pull out the rate case before the Commonwealth Public Utilities Commission.

Docket No. 13-01 has been with the CPUC since July 2013. It is a rate case petition comprising various components of which some have been adjudicated and acted on this year.

Reyes pointed out that it is only fitting that, as the decision-making body of the agency, its board has the final say on whether there’s a need to petition for rate adjustment or not.

“These petitions were done prior to establishing this board and now that you have a quorum, I respectfully request that the board recall these proposals and have them fully reviewed first,” said Reyes, adding that the rate case was presented by CUC’s administrative officials only, without the CUC board’s formal approval.

CPUC had earlier approved the increase in electric base rate and portions of the non-revenue rates recommended for certain customers. These two are part of the Docket No. 13-01 that was filed in July last year. Among the items remaining in the docket and awaiting approval from the commission are 11 non-revenue rates.

Reyes and Deleon Guerrero said the “recall” is specifically requested for all items not yet adjudicated by CPUC.

According to the lawmakers, rate increases or news of potential rate hikes create panic in everyone, including the Legislature.

“If we can do something to reduce the rates, let’s do it,” said Reyes, reminding the board that action to reduce the service cost and action to improve service delivery translates to revenue increases for CUC.

CUC board chair David Sablan Jr. told the PUTC panel heads that the board would certainly consider the lawmakers’ appeal.

“I would ask our management if we can pull back some of those things not yet adjudicated by CPUC and give us some briefing so we can understand what was sent in July last year because it could be different now [since the petition was filed],” said Sablan.

Sablan admitted that since the CUC board was revived, it has been bombarded with criticisms as a result of the rate hike proposal that was endorsed prior to board’s reinstatement. He specifically cited complaints about the “very high” fees recommended for non-revenue rates. NRRs are isolated fees for specific customers.

He noted that, because of disagreements within the board, CUC was able to withdraw the controversial standby charge earlier proposed for large customers, which was also part of the same docket case.

Despite the receptiveness Sablan expressed on the lawmakers’ recall request, the board, however, did not vote yesterday whether or not the remaining petition will be recalled or not.

CPUC consultant

CPUC’s consultant, Georgetown Consulting Services, was lambasted again yesterday by the CUC board chairman and PUTC committee chairpersons for two reasons: the “high” rate it charges CUC and the long period it takes to review a rate case.

Sablan vowed yesterday that the board would stop this practice of paying the commission consultant exorbitant fees for a simple rate case from a small utility like CUC.

“I can tell you, they’re not worth the money,” he told the board, citing his experience in Guam. Sablan is a former GPA board chairman.

From July 2013 to the present, Sablan said, CUC’s rate petition has been on the CPUC table for one year. He also disclosed approximately $500,000 in expenses that CUC incurred in a typical rate case with Georgetown.

Sablan hinted yesterday that changes will soon be seen in this regard. He cited the issuance of RFPs for a rate reviewer who would charge a more reasonable fee.

Besides Georgetown, CUC’s rate consultant economists.com also came under criticism from Sen. Reyes.

Having both Georgetown and economists.com charging CUC for consultancy services “is like Abramoff all over again,” according to the lawmaker.

Besides the recall request, the board was also urged by the PUTC panel chiefs to use Rota as the pilot project for alternative energy to lower utility cost and eliminate the subsidy being provided by Saipan to customers on the island.

Sen. Reyes also urged the removal of “electric service charge on water” for Rota as generators are not actually being used there.