Georgetown lawyer, CUC chief in heated discussion on fees

Commonwealth Utilities Corp. executive director Abe Utu Malae and Georgetown Consulting Group Inc. counsel Robert Torres exchanged barbed words yesterday at the Public Utilities Commission meeting during discussions on the regulatory fees being assessed and charged the agency.

Georgetown is a consultant of the Commonwealth Public Utilities Commission but it is paid by CUC based on fees assessed by the commission. CUC also pays for its own consultant, economists.com.

The discussion’s flashpoint was triggered by talks about the abolition of the levelized energy adjustment clause, LEAC, and replacing it with the monthly fuel adjustment clause, or MFAC. The LEAC, which reflects the cost of fuel, is reviewed every six months. MFAC will change this to every month so it could provide immediate relief to customers in case fuel prices drop.

Malae supports the MFAC proposal, describing the measure as a reflection of “reality” and would be helpful to customers. He also took exception to Georgetown’s fees, saying they are too high for a small utility firm like CUC.

Torres emphasized that Georgetown was instrumental in developing the LEAC process, which he claims was not even created by the previous CUC management.

“CUC, under previous management, doesn’t even know how to come up with a LEAC rate. Georgetown assisted CUC with this LEAC process. This history is important because this is highly technical part,” he said.

Torres said the current LEAC is not a perfect process because it involves several technical issues that require expertise. LEAC, he added, also exists in other jurisdictions and he believes it provides transparency in CUC’s operation.

He also defended Georgetown’s fees, saying all fees paid by CUC are assessed by the commission and are based on law.

Malae disagreed.

“Rather than assessing over a long period of time of six months, why not do it in a monthly basis to reflect the actual price of our fuel delivery? Sorry, Mr. Torres but I can’t take your arguments too seriously because you are the attorney for the consultant. If you go to the Legislature and talk to them how bad the impact is, I am looking at your own motives or your personal interests in this matter. I can’t take it [your statements],” said Malae, adding that the regulatory fees are just too high for CUC.

Malae and Torres tried to interrupt each other, finally forcing Alepuyo to order them both to stop.

“Hang on, hang on, hang on. Stop! Stop! I am not going to listen to it! It’s not going to happen. If anybody knows what’s public comments are for, it would be unfair for me to continue this. It’s not a process for back-and-forth arguments. You have that opportunity before you brought your stipulation here. Let me assure the members of the public that with regards to regulatory costs, CPUC is very mindful what the costs are from the beginning and we always tried to bring that down,” she said, before ordering a recess.

CUC earlier disclosed that Georgetown has billed CUC a total of $1.2 million in fees and expenses since December 2008.