CUC readying new water rate hike petition

Customers of the Commonwealth Utilities Corp. may not experience actual relief in their utility bills even if some reimbursement is approved for the levelized energy adjustment clause rate following the agency’s disclosure that it is also preparing to file a new petition for water and wastewater rate hikes.

Acting executive director Alan Fletcher said Wednesday that they are working on “laying out the justifications” for the rate hike petition.

“I think we have a case to make. We know [the Commonwealth Public Utilities Commission] has a lot to consider and we know that they will look at it thoroughly and fairly,” said Fletcher.

Water and wastewater rates were last adjusted in May 2010.

CUC was supposed to present its proposal for new water and wastewater rates in July but this was delayed because of the lack of CPUC commissioners.

CUC chief financial officer Charles Warren earlier told Saipan Tribune that CUC’s operating losses for both water and wastewater for just eight months ending on May 31 this year was at $2.8 million: $1.1 million for water and $1.7 million for wastewater.

Fletcher said Wednesday that CUC and its rate consultant have yet to come up with final numbers pertaining to the new rate petition.

CUC is expected to file the rate hike petition at the commission’s Oct. 12 meeting.

Based on CUC records, the agency has an operating budget of only $11.7 million for water this fiscal year compared to the $13.3 million expenses it incurred as of May 2011.

For wastewater, the overall operating expenditure of $9.2 million has already exceeded the allotted budget of $8.2 million for the entire fiscal year—a shortfall of $1.1 million.

CUC legal counsel Deborah Fisher told Saipan Tribune that CUC is not for profit. “This means we can only provide the services that we are able to get the revenue for,” she said after Wednesday’s meeting.

Fisher admitted that the proposed changes in the existing LEAC charge to customers may be affected by the new rate hike petition because electricity is also being used to run water and wastewater systems. She said this will be thoroughly assessed by the agency’s consultant, economist.com, and chief financial officer Warren.

Fisher and Fletcher said that CUC needs adequate funding in order to complete its systems’ upgrade and repairs.