CUC may award Saipan power contract in May

The Commonwealth Utilities Corporation expects to award a multimillion-dollar contract for the Saipan power project this May amid attempts by the Legislature to investigate its decision to scrap the initial plan after nearly three years of soliciting and evaluating proposals.

While uncertain whether an oversight hearing will take place, CUC Board Chair Rosario M. Elameto offered to bring a representative of its independent consultants to appear before any legislative committee tasked with the probe.

But she said the utility corporation will continue drawing up a plan for the construction of a 60-megawatt plant as recommended by Burns & McDonnell, the engineering firm it hired last year to evaluate bids and assess power load growth on Saipan.

“We are actively pursuing this goal and expect to have a contract awarded by May for the 60-MW expandable plant,” said Ms. Elameto in a letter to presiding officers of the Legislature.

Noting the agreement reached at a recent joint meeting between CUC and the Public Utilities, Transportation and Communications Committees from both houses, she said a Burns & McDonnell representative will be available to answer other questions from members regarding the controversial project.

“Our understanding currently is that there may soon be a formal oversight hearing focusing on this power plant project,” the CUC official explained. “If this is the case, we feel that it would be best to bring the representative of the firm to Saipan for the formal hearing.”

Either legislative panel has yet to decide whether to launch a full-scale inquiry, although the Senate Executive Appointments and Governmental Investigations Committee is set to meet next week to begin its probe on allegations of bribery leveled against CUC Executive Director Timothy P. Villagomez.

According to Ms. Elameto, the government-owned utility corporation has been assured that any investigation would not disrupt efforts by its board to keep the project on track and begin its bidding as soon as possible.

CUC last month canceled the original request for proposal on the 80-MW plant, citing its shaky financial condition and the continuous economic difficulties confronting the CNMI that have pulled down power demand here.

Instead, a fresh bidding will be conducted soon for a smaller-size plant with capacity of 60 MW based on the recommendation by Burns & McDonnell.

But several lawmakers have opposed such a move, noting that re-bidding the project would further delay the three-year old procurement of the project and put in peril the island’s economy.

So far, Sen. Ramon S. Guerrero has come out with allegations that point to possible impropriety by utility officials on the handling of the project which has been drawing controversy since the initial RFP was issued in 1997.

Designed originally to meet anticipated surge in power demand by 2000, it was to be constructed through build-operate-transfer scheme under a 25-year deal to be repaid through revenues collected by CUC.