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House approves discounts on power bills
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Posted on Jun 18 2008
The House of Representatives passed a bill granting customer discounts on power billings.
The bill would require the Commonwealth Utilities Corp. to waive a portion of the fuel component of power rates. The discount will amount to 30 percent of the fuel rate for residential customers, and 10 percent for commercial customers.
The bill would also repeal a law that allows the Public Utilities Commission to make decisions even if it has only one member.
The “electric fuel charge credit” will apply retroactively to May 3, 2008, when CUC’s doubled rates went into effect. It will continue until the $9 million appropriated by the Legislature is exhausted. It is not clear how long the subsidy fund will last, since fuel costs fluctuate rapidly. But the Legislature expects the fund to last through December 2008.
It is also not clear how the subsidy will be applied. The initial proposal was for CUC to add a line item for “fuel charge credit” in the billing. But the May billings have already been sent out to the customers. CUC executive director Antonio Muna has said the discount would likely be applied when the customer comes in to pay at CUC.
The subsidy is designed to give the customers some relief from the skyrocketing cost of power.
For residential customers, electric rates are now at 40.3 cents per kWh for the first 500 kWh—the highest ever rate to be charged by CUC. The rate increases with usage, going up to a maximum 51.4 cents per kWh for consumption over 2,000 kWh.
Businesses and government offices are charged even more. The commercial rate is 47.3 cents per kWh, and the government rate is 47.8 cents per kWh. For “non-conforming load,” the June rate is 60.9 cents per kWh.
The law, which allowed for the rate increase last month, provided some $9 million for CUC’s fuel expenses. The idea was for CUC to pass on the subsidy to the customers. But because of ambiguity in the law, the subsidy was not factored into the computation of the new power rates.
