New CUC board chair opposes standby charge proposal

David J. Sablan, chairman of the newly revived Commonwealth Utilities Corp. board, is personally opposed to the standby charge being endorsed by the agency for its large customers that mainly rely on their own power generators for their daily operations.

For Sablan, charging individuals that are not part of CUC’s customer base simply doesn’t make sense.

“CUC is proposing to charge a certain fee for being off the grid and personally, I don’t understand that because if someone is off the grid and not using our grid, why should we charge them?” Sablan said in an interview with Saipan Tribune.

Pending at the Commonwealth Public Utilities Commission’s table is a decision on the proposed $20 per kW monthly charge for large customers, which is projected to bring in $2 million in annual revenues to the financially challenged CUC.

If implemented, those who will be affected by the new charge are members of the Hotel Association of NMI and the Saipan Facilities Management Association, which earlier opposed the recommendation.

According to Sablan, instead of pushing for the new charge, the utilities corporation should instead work harder on getting more customers back into its fold. He said there’s no way he can support the recommendation of CUC.

But because the standby charge proposal is already with CPUC’s hands, Sablan hinted that the board cannot do something about it for now.

“It’s now in the hands of CPUC, but personally I am not in favor of it. I would rather sit down and negotiate with these commercial customers that are off the grid and see what needs to be done to bring them back to CUC,” he said.

When asked about the possibility of the CUC board asking management to amend the standby recommendation, Sablan said: “There’s a possibility on that. But we need to look at what the procedures are. We have to make sure that if we were to stop that, we’re not violating any regulation and policy. And my understanding is: a decision is forthcoming already [from CPUC].”

During the April 2 CPUC meeting, the commission—after hearing concerns of both SFMA and HANMI—ruled to delay action on the standby charge proposal to its next meeting on May 22.

At the time, CPUC also disclosed the creation of an “alternative tariff,” which is now being discussed by CUC, Georgetown Consulting, SFMA, HANMI, and CPUC’s hearing examiner.

CPUC reported that there are active discussions between parties on “incentive rate options” to encourage self-generating large commercial customers to become full-time CUC customers.

Under the CUC’s standby proposal, there are only two ways to prevent large commercial customers from paying the charge: to hook up to CUC or to physically disconnect from the grid completely.