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150K fuel subsidy proposed
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Posted on Nov 19 2004
Acting Gov. Diego T. Benavente is pushing for a $150,000 a month fuel subsidy for the Commonwealth Utilities Corp. to arrest any potential power supply breakdown in the CNMI.
Benavente said yesterday that the figure is based on a 1.5 cent subsidy to be appropriated by the Legislature.
This follows the possible scenario of implementing a 3.5 cent fuel surcharge fee but reducing it to 2 cents for residential and commercial users and 1.5 cents for the government as a form of subsidy.
He said the residential collection makes up 30 percent of CUC’s overall collection, based on the existing electricity rates.
Benavente said the government subsidy would only be made for three to four months.
“We’re not saying it’s for the rest of the year. We’ll see at three to four months so that the impact is gradual,” he said.
Meantime, Senate President Joaquin G. Adriano said he supports the government subsidy for fuel.
“We tend to support subsidy. I understand that the House is also looking into this issue. So we’ll be working together to come up with the best solution,” he said.
Benavente believes that FSF is justified in view of fluctuating fuel prices. Right now, he said the issue is not whether the fuel surcharge can be held back because it is the power supply that is at risk.
“My question is, ‘Is this something that we really want to gamble on?’ Yes, it’s going to be tough but it it’s going to be tougher if we begin to experience power outages, blackouts. I don’t want to risk that. It’s inviting more woes and it’s going to hurt the economy,” he said.
Benavente, meantime, said that the proposed interim fuel subsidy, as proposed by House Vice Speaker Timothy Villagomez, “is harder to do.”
The lawmaker proposes a bigger government share of $2.5 cents in the form of subsidy, the commercial users at 1 cent, while the residential users would pay zero FSF.
Villagomez, chair of the House Committee on Public Utilities, Transportation, and Communications, earlier said that Benavente’s legislated subsidy proposal “would take considerable time.”
He asked the CUC to ask the administration to reprogram funds for CUC’s immediate fuel needs.
CUC intends to implement the 3.5 cent FSF by early December.
