CPUC to decide on large commercial incentive rate contract today

The long-awaited incentive rate that would encourage large customers to hook up to the Commonwealth Utilities Corp. grid is up for consideration by the Commonwealth Public Utilities Commission today, Sept. 4.

The new rate will cover existing large commercial customers and new commercial customers.

Consultants for both CPUC and CUC had approved a modified incentive rate proposal on May 28, 2014, after long discussions on the past standby charge for commercial customers.

Both CPUC and CUC agreed to come up with a contract that would help large commercial customers experiment before officially getting into CUC’s grid.

The proposed contract was given to CPUC on Aug. 2 and was reviewed by Georgetown Consulting Group. CUC executive director Alan Fletcher told Saipan Tribune that they met on Sept. 2 to discuss the draft contract.

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 taking service on this incentive rate or IR must agree to remain full requirements customers of CUC for the four-year duration of the IR term,” the contract states.

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

The contract states that a “total cumulative electric demand” under the incentive rate “shall not exceed a program cap of 20 megawatts.”

Commercial customers are qualified 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.

“The purpose of the contract is to offer and attract self-generating businesses back onto our system because we have a lot greater reliability today and good operating practices and we need the baseload back to be in a better financial situation,” Fletcher said.

Fletcher said he is not too sure if the CPUC will approve the contract or not.

“I am not sure what will happen or if it will be finalized or not. The final contract approval is expected this month or early October, but we’re not too sure for now,” he said.