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CUC limits production of Puerto Rico plant
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Posted on Feb 06 2005
The Commonwealth Utilities Corp. in another cost-cutting measure has started to limit production at its Puerto Rico power plant.
CUC executive director Lorraine Babauta has instructed Pacific Marine and Industrial Corp., which operates Power Plant 4, to provide CUC only 7.3 million kwh per month. This is the minimum amount of power that the utility firm is required to purchase under the terms of its contract with the independent power producer.
Effective Jan. 27, PMIC was to reduce or suspend the provision of power from the plant to CUC so that the total kilowatt hours purchased by CUC does not exceed the 7.3-million kwh limit, Babauta said.
She added that CUC will not pay for additional power production unless CUC formally requested the additional kilowatt hours.
“We regret the necessity to strictly limit production from Power Plant IV. However, our current financial situation requires that we keep this expense to an absolute minimum,” Babauta told PMIC general manager Phil Hornibrook. “We very much appreciate the assistance that you have given us in the past our ability in the past to provide back up generation in times of need.”
Citing a report by the CUC management, CUC chair Frank Guerrero said Friday that CUC’s available cash now totals only $1.4 million. By March, the firm will have less than $200,000 in the bank, he said.
He noted that CUC’s monthly fuel cost averages $5 million. Other expenses include the payroll, operational costs, and payments to the independent power producers—PMIC and Telesource CNMI.
Power Plant 4 was reopened in January 1992 after CUC hired PMIC to operate the plant. PMIC sells electricity to CUC and provides back up power during emergency cases or when the any of the two main power plants in Lower Base are undergoing overhaul or maintenance work.
