The Commonwealth Public Utilities Commission confirmed yesterday that a new order to lower the levelized energy adjustment clause rate, or LEAC, will be issued today as soon as its meeting is over.
CPUC chair Joseph Guerrero said after yesterday’s public hearing at the Multi-Purpose Center that the approval of a lower LEAC rate will be the first order the commission will issue out.
LEAC is part of the customer’s bill that reflects CUC’s fuel costs. The other component is the electric base rate, which funds operations and maintenance, capital outlays, and debt servicing.
“This will be the first order [of the commission] regarding the LEAC rate. It is an interim reduction and when the commission comes back in apring, we may find another reduction,” said Guerrero.
Effective Jan. 1, 2014, the new LEAC rate will be $0.30426 per kWh. This will take effect until amended or changed by the commission. For the average residential customers using 455 kWh monthly, this represents a reduction of $6.46 per month in their billing.
The commission held a hearing yesterday at the Multi-Purpose Center to hear community testimonies on the several proposals filed by the Commonwealth Utilities Corp. The panel just started functioning in July after more than a year in hiatus.
Guerrero said that with all the documents and activities that needed to be reviewed and assessed, this “interim reduction” in the LEAC rate is the only one they can decide for now. Further cuts may come after the commission’s spring regulatory hearing.
The commission’s decision to reduce the LEAC rate was the result of a joint stipulation filed Friday by both CUC and the commission’s consultant, Georgetown Consulting.
According to CUC officials yesterday, the reduction in world oil prices enabled CUC to recommend a reduction in its LEAC, which is currently at $0.31878 per kWh.
Once the formal order is issued today, CUC can change the LEAC rate to reflect the high/lower MOPS price and provide calculations and supporting documents to CPUC and Georgetown. This change should be calculated on the basis of fuel used in the calculation of the current LEAC rate.
CUC records show that it has 14,401 power customers, of which 10,878 are residential users, 2,606 are commercial customers, and 917 are government customers.