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House lawyer: CUC rate change incorrect
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Posted on May 29 2008
The Commonwealth Utilities Corp. was wrong to put the new rates into effect on May 3, 2008, according to a legal counsel for lawmakers.
House legal counsel Jose A. Bermudes said that CUC has the power to raise the fuel component of electric rates, but the new fuel rate should not have been applied in the middle of the billing cycles.
Bermudes noted that Public Law 16-2, which allowed for the rate increase, specifically provides that “any new schedule of electrical fuel rates shall not apply until the subsequent monthly meter reading date.” In other words, CUC cannot change the rates in the middle of any of the billing cycles.
The new rates went into effect on May 3, immediately after the governor approved a measure reversing a previous rates rollback law.
According to Bermudes, the earliest date CUC should have implemented the new rates is May 8 for the first billing cycle, May 15 for the second billing cycle, May 22 for the fourth billing cycle, and May 29 for the fourth and fifth billing cycles.
Rep. Tina Sablan raised this point when CUC executive director Antonio Muna met with the House Committee on Public Utilities, Transportation, and Communications last week. Bermudes issued the legal opinion at her request.
“It is, in my view, illegal for CUC to change rates in the middle of the billing cycle, as the agency is now attempting to do,” she said. “The recently enacted Public Law 16-2 suspended only Section 2 of Public Law 15-94, which had artificially rolled back the utility rates to a flat 17.6 cents per kWh. The Legislature had not suspended Section 3 of PL 15-94, which had prohibited CUC from changing rates in the middle of the billing cycle.”
Muna has not replied to an e-mail asking for his comment at press time.
Under the new rate scale, customers must pay a total of 37.3 cents per kWh for the first 500 kWh of usage. The rate increases with consumption. Prior to May 2008, customers paid 17.6 cents per kWh for the first 1,000 kWh.
