The rate hike, which has to be approved by the Commonwealth Public Utilities Commission, will mean an additional $4.18 per month imposed on a residential customer and $28.30 per month on a small business.
CUC chief financial officer Charles Warren, in his testimony to CPUC, said their power division spends $32 million per year to provide electricity service to customers.
“If we are going to keep the lights on we must cover our new costs,” CUC Executive Director Utu Abe Malae told CPUC.
“Right now our power plant has virtually no spare parts, many of our power distribution is failing, and our old trucks can’t get our people out to the customers’ job sites,” he added.
Malae said the proposed base rate increase is in response to the federal court’s order for the cleanup and prevention of oil pollution.
“The order demands people, equipment and construction that federal grants will not fund,” he said, citing as an example CUC’s large oil pipeline in Lower Base that won’t stop leaking and must need to be replaced before it pollutes the lagoon.
Malae “apologized” on behalf of CUC.
“I must apologize. These are tough times. It is difficult to be asking for even these few dollars of rate increase at this time. We really have tried to operate off of new efficiencies and federal grants before asking our customers for this base rate increase. We hope that our customers understand — CUC must keep the lights on and the pumps in our water and sewer systems pumping. And we need this money to do it.”
According to CUC, higher volume users and commercial customers will experience higher power rate increases.
“That is because about two-thirds of every customer’s bill pays for oil. The typical residential customer, at 500 kwh per month, pays a total of $136 per month. Of that bill, roughly $90 is to pay Mobil Oil Company for the diesel oil burned in CUC’s power plants. The base rate increase would add $4,” CUC said.
CUC said this would be its first increase to its minimum monthly charges in a decade.
Last September, less than two months before the congressional delegate election, CPUC rejected CUC’s proposal to increase its power rate from $0.24446 to $0.25338 per kwh.
