CUC’s dual paralysis!

CUC is financially paralyzed while forcibly inhaling fire from EPA for failing to fulfill federal court stipulated orders on an unfinished oil pipeline and fuel tank.

Its inability to meet federal stipulated orders confirms it’s ill equipped with the technical and fiscal competence to get the job done. EPA is back, seeking for receivership and must wonder as to gold-plated pipeline cost.

CUC boss Alan Fletcher and cabal must retract into their hermit crab shells to think through how all hell broke loose! He’s taken the agency from incompetence to fiscal paralysis. This setback has metastasized into every corner of the utility agency it’s hard to tell whether it’s coming or going.

Would it slide into a politically motivated scheme? Would the unintended consequences result in higher power rates given CUC’s technical deficit and managerial incompetency?

It must now focus its attention paying obligations (if the NMI government pays its debt) or even ensure the sputtering power generation doesn’t turn into persistent brownouts. Has everybody noticed that outages are already occurring more and more often?

The last improvement to the old power system was about six to eight years ago when I availed, through MPLT, $3.5 million to upgrade the 36-year-old generators. This succeeded and thus we averted unsolicited brownouts. But nothing has happened since then.

The old diesel plant has seen steady deterioration and is once again facing hard maintenance issues, including timely repair of its distribution system should perchance a super storm visit us. This has been put off indefinitely.

It’s one problematic issue after another, all needing money to which there’s hardly any. We could also smell a rat: CUC wants to retain use of its dilapidated diesel engines, thus the decision to limit renewable energy below 40 MW. Doesn’t make sense at all now, does it?

The 10MW solar proposal hasn’t gotten anywhere in nearly three years, nor has CUC seen fit to call for a rebid given the sizeable decrease of cost for solar PV as a result of advances in technology. In addition, the company reserves another four years to build it out while a plant of this size could be completed within six to eight months. Why six to eight years versus six to eight months, realistically?

Obviously, there should be the question on whether the size (10 to 40MW) is financially viable. Is there any decent return on investment mirrored against lacking utility-of-scale once again and while the grid requires upgrade no matter what? Didn’t a recent DNV study cap the influx of renewable into the Saipan grid at 8MW? What’s the use of that study if CUC forges ahead to asking for more MWs that the grid apparently cannot handle at its current stage? Or was that grid study another waste of time and grant money?

None of it gets ever discussed publicly, specifically who pays for power grid hook-up or backup systems? The muted discussion is understandable: it would cost some $18 million and $35 million each, respectively. Who pays for it? Therein lies the rather highly muted discussion, much like those surrounding the casino deal.

Now it blames the contractor for delays in the federal stipulated order. Fine! But isn’t CUC still in charge of the mess? Eh, using the mirror on the wall doesn’t work either!

CUC can’t fork out any amount to facilitate the project moving forward. Not only is it bankrupt, it also has a history of not paying its bills with vendors on time. Both the CNMI government and utility are broke and without any credit standing. Political leadership doesn’t seem to understand the difficulty to finance anything here instead of asking Best Sunshine at every turn to loosen up more cash, in the process giving up further control of our islands.

The Department of the Interior has retained an engineering firm to help CUC establish an IRP (integrated resource plan)—essentially a roadmap to resolve the lingering and disorienting power situation in the NMI. All the while CUC doesn’t have the competence or fiscal wherewithal to do anything with common decency, so it’s little surprise for yet another federal agency having to step in.

By calendar yearend, recommendations for the IRP should lead to some concrete plans including selection of most suitable renewable energy sources and their anticipated penetration into the CNMI grid, ultimately affording it to get out of fossil fuel dependency.

Wow, undoubtedly this will result in some form of shake-up of the leadership via the local oil lobby. Already rumors abound of politically motivated power related “October Surprise” or an announcement by the current administration via CUC and to forge ahead with yet another renewable energy mirage. Obviously, it seems a work in progress to ignore the upcoming IRP results as this would fall outside the all-prevailing election efforts. It would once again reflect in half-baked and unsubstantiated procurement efforts, joining the past and sad track record of leading nowhere.

But be cautious of OIA’s reaction to any such in-your-face ignorance. With election around the corner, these kinds of endeavors by the CUC, at this late hour and in light of the impending receivership, would further contribute to overload of their limited capabilities, plainly resulting in more taxpayer dollars wasted. Justifying CUC’s existence goes to show its proclivity piling one incompetency after another. The feds are loaded with resources. CUC is bankrupt!

Hopes for reduced power rates are once again dashed by ignorance, fiscal paralysis, and incompetency. It could try braving a useless Trojan horse, playing only further into the diesel reliance. It would come out swinging that it has a plan to lower power rates. Oh? What has it been doing over the last 10 years? The Trojan horse needs to be sent out to sawdust pasture where it could be used as BBQ wood, pigpen, or chicken coop!