By Gemma Q. Casas
Variety News Staff

LESS than a month after the Legislature enacted a law to reduce the power rates of residential customers, Gov. Benigno R. Fitial signed an emergency declaration allowing the Commonwealth Utilities Corp. to impose the highest rate in CNMI history.
House Bill 15-246, which became Public Law 15-94 after lawmakers overrode the governor’s veto, reduced the residential rate from 22.8 to 17.6 cents for the first 1,000 kilowatt hours.
On Friday, Fitial’s emergency regulations stated that CUC can charge 25.8 cents.
The 25.8 cents applies to the first 1,000 kwh — over 1,000 kwh will be billed at 30.2 cents per kwh.
In a 13-page document published in the Commonwealth Register, the governor said the emergency regulations were necessary to ensure that the islands continue to have water, sewer and electrical services.
“[T]he public interest and the need to prevent imminent peril to the public health, safety or welfare requires the adoption of the attached regulations without prior notice or hearing,” stated Fitial.
The emergency regulations will be in effect for the next 120 days.
He said the Legislature’s move to reduce the residential electric rates endangers not only CUC but the safety of all residents who use public health facilities. Water facilities are also at stake, thus the new regulations were adopted on an emergency basis.
“CUC is currently unable to pay the costs of operating, maintaining and delivering utility services. Without an adjustment of its utility rate structure based on an accurate analysis of the actual costs of fuel, CUC will be unable to provide power for such necessary services as water pumping and treatment, sewage pumping and treatment, electric service to CHC, to schools, clinics and homes, and to companies that produce drinking water,” he said.
He said CUC’s annual cost for No. 2 diesel fuel increased from $27.5 million in fiscal year 2002 to $75 million in FY 2006.
“These costs have increased even further in fiscal year 2007 as the price of oil and the price of No. 2 diesel fuel continues to rise. The cost of a barrel of oil has gone from $20 in 2002 to over $86 a barrel in 2007. The cost of production of electricity currently exceeds revenue generated from the sale of electricity to customers,” he added.
Pamela Mathis, the CUC spokeswoman, said in a statement that residential customers will still see a reduction in their power rates last month.
“Residential customers will be receiving a credit, however, for an October rate reduction and billing adjustments that will appear on their next routine billing statement. Even so, they are encouraged to continue conservation of energy to keep their bills as low as possible,” she said.
“Our customers will take satisfaction in knowing that for an entire cycle or one month, they did receive electricity below the true cost of producing it, as initially set at 17.6 cents per kilowatt-hour by P.L. 15-94,” she added.