THE Commonwealth Utilities Corp. board on Wednesday approved the CUC-Public School System net metering policy memorandum of agreement.
Following the approval of the MOA, CUC legal counsel Jose Mafnas Jr. said PSS can avail itself of net metering benefits.
But he said there is a legal issue between CUC and PSS regarding the interpretation of some of the language of Public Law 18-75, which allows CUC to establish a net metering agreement with public health and education entities.
Mafnas said that the CUC board “recognized the need for this MOA, so that PSS can install its solar panel system.”
He said the agreement will also allow the parties to amend the MOA if needed pursuant to the opinion of Attorney General Edward Manibusan.
The AG’s opinion will provide a uniform legal interpretation of the provisions of P.L. 18-75, Mafnas added.
Under the MOA, PSS will install solar panels in all its schools. Any excess power they produce will go to CUC. PSS gets a credit on the number of kilowatt-hours it provides CUC.
In case of adverse weather, PSS can buy electricity from CUC. PSS, however, also wants to pay for the CUC electricity it will use minus the credit from the excess electricity that the PSS solar panels have generated.
PSS legal counsel Tiberius Mocanu said: “Where we started disagreeing is about the period in which [the net-metering] credits roll over.”
He added, “As you can imagine the weather in the CNMI is very different and in order to get the best use of those solar panels we would like maybe use some of the excess we produce during windy seasons —like in January or in the summer months, or in the rainy season when we might not produce that much. What we ask for, what the law calls for, is that those [net-metering] credits roll over for a two-year period, [and] that you can use excess credits that you produce in high producing months to offset low producing months, and there would be a reconciliation on a cycle, every two years, when we either owe money because we don’t produce enough, or we would be owed money.”
Mocanu said initially PSS agreed to produce 95% of its energy needs. “As such PSS will not create any excess, and CUC will never have to purchase excess credits that PSS produces.”
But he said based on CUC’s interpretation of the law, if PSS over produced, say, in January, but produced 60% only of its energy needs in August, for example, “it would not get the offset of January — PSS would have to pay CUC for 40% of its energy needs in August.”
Mocanu said the law was “written to incentivize both hospital and education entities to get off the [CUC] grid to ease the burden on CUC, and to move to a more sustainable future for the CNMI.”
He said under CUC’s interpretation of the law, PSS would have a worse deal than residential customers whose interconnection agreement with CUC allows for a 12-month rolling basis: “Those credits made in January are good until Dec. 31 of that same year and then they expire,” he added.
“It does not make sense that in order for [public health and education entities] to get off-the-grid that they would be given two years [only], and after that you are month to month. Because being month to month does not justify the extreme expense that PSS has to go through to get financing to put these solar panels up…. At the end of the day it might have two utility bills that it needs to pay for: the solar panels on a 20-year contract, and then…a CUC bill to boot because [PSS] can’t roll over its [net-metering] credits,” Mocanu said.
Board of Education Chairman Andrew Orsini told the CUC board to keep in mind that PSS is a non-revenue generating entity.
“We are a little different from the hospital — we don’t generate revenues in anyway, we are…subsidized…to survive, so to speak,” he added.
Present at the board meeting on Wednesday were CUC board chair Miranda Manglona, members Janice Tenorio, Jovita Paulino, Weston Thomas Deleon Guerrero and Aubry M. Hocog.
Coming out of an executive or closed-door session at past noon, board member Tenorio, a former BOE chair, moved to allow PSS to produce solar energy for all its energy needs, which was approved by the other CUC board members.
According to CUC deputy director William Gilmore, the school system’s switch to solar energy will result in a monthly revenue loss of about $100,000 for CUC.
PSS pays about $2.2 million a year for power.
In photo are Commonwealth Utilities Corp. board chair Miranda Manglona, board members Janice Tenorio, Jovita Paulino, Weston Thomas Deleon Guerrero and Aubry Hocog with CUC legal counsel Jose Mafnas Jr., CUC deputy executive director William Gilmore, acting CUC executive director Betty Terlaje, Education Commissioner Dr. Alfred Ada, Rep. Richard Lizama, and Public School System legal counsel Tiberius Mocanu.
