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Rise in fuel prices results in FAC increase
With the increase in the prices of fuel comes an increase in the price of electricity in the CNMI.
The Commonwealth Utilities Corp. announced yesterday that it will be increasing its Fuel Adjustment Charge, effective today, March 1, 2022, from $0.23908 per kilowatt-hour to $0.27122 per kWh.
In a news release yesterday, CUC said that it has been notified by its fuel supplier, Mobil Oil Mariana Islands Inc., that there has been an increase in the average international fuel oil prices that will affect the FAC.
The FAC is one of two components that make up the CUC electric kWh rate, which is used to purchase fuel. The second component is the CUC base rate, which is used to fund operations, projects, and debt service. This base rate has not been increased since April 17, 2014.
CUC is required, pursuant to an order previously issued by the Commonwealth Public Utilities Commission, to adjust (up or down) the FAC pass-through rate when the Mean of Platts Singapore, or MOPS, monthly pricing equals or exceeds a 4.5% differential of the average per gallon cost of fuel used in the calculation of the current FAC rate.
CUC first instituted the Levelized Energy Adjustment Clause in 2009 to recover fuel and fuel related costs, a system also used by power providers in Guam and the U.S. Virgin Islands. In May 2015, the CPUC authorized CUC to change the name of LEAC to FAC to provide customers a more accurate description of the electric rate. (PR)
