The Commonwealth Utilities Corp. approved a new tariff for levelized energy adjustment clause, or LEAC, as a result of the recent rise in fuel prices.
From the existing LEAC rate of $0.26373 per kilowatt-hour, the new rate mandates a $0.28168 per kWh effective today, Aug. 3.
The new tariff is comprised of the following components: LEAC fuel and lube oil, $0.26575; volatility component, $0.01196; regulatory and technical support element, $0.00123; and allowance for doubtful accounts, $0.01081.
LEAC is part of the customer's bill that reflects the cost of fuel. It is supposed to go up or down to reflect the cost of buying fuel to run the power plants. The other element of the bill is the electric base rate.
At present, the electric base rate is $0.0220 per kilowatt-hour. With the adjusted LEAC rate of $0.28168, the new power rate for average residential customers is $0.30368 per kWh effective today. Average residential customers are those who are using up to 500 kWh monthly.
CUC acting executive director Alan Fletcher told Saipan Tribune yesterday that the 6.8-percent increase reflects the actual fuel hike experienced by the agency in July and which it directly passes on to its customers.
He described the LEAC increase as still nominal and pointed out that it is only one portion of the customer's billing. Fletcher said CUC in the past couple of months reduced by 20 percent the LEAC rate when fuel prices went down in the world market. He was alluding to the LEAC reduction implemented in April and June this year.
The new tariff will take effect until changed by the utilities firm. Fletcher said CUC is monitoring the prices in a monthly basis which will dictate any adjustment.