‘CUC staging blackouts’

Governor consultant and former senator Ramon “Kumoi” S. Guerrero accused the Commonwealth Utilities Corp. and the Babauta administration yesterday of staging the rolling blackouts and broken power engines to push for privatization.

“Personally, I believe it [privatization] is the reason,” said Guerrero to a question posed by Vice Speaker Timothy P. Villagomez during yesterday’s hearing.

Villagomez who chairs the House Committee on Public Utilities, Transportation, and Communications, held a hearing yesterday to receive Guerrero’s report on the government’s power privatization program.

At the same time, Guerrero, who was paid $7,000 a month since May by the CUC to rehabilitate Power Plant 2 and review the Power Plant I privatization, said that he actually does not support privatization. He was hired at the recommendation of Gov. Juan N. Babauta.

“They know I’m against it. Even if a privatization contract is awarded today, it won’t solve the problem,” he said.

Further, Guerrero said he does not believe that a fuel surcharge is needed, noting that Power Plant I only consumes 64 percent of fuel.

“Why charge fuel surcharge? I disagree with that. It’s only a subsidy. So, where does the 3.5 cents go? It goes there, there,” Guerrero said, pointing his finger toward his back.

Guerrero’s contract with CUC ended last week. His other contract with the Governor’s Office, a $50,000 engineering contract for La Fiesta, ends this Thursday.

He said he has no intention to renew either of the contracts.

Yesterday, Guerrero accused the CUC and the administration, particularly Attorney General Pamela Brown, of allegedly refusing to approve his requests for the purchase of spare parts, which he said, prompts him even more to suspect that the CUC and the administration are staging a situation to go for privatization.

“How can you explain the Attorney General’s refusal to buy spare parts? I’ve kept requesting for spare parts, but I’ve got nothing. For two and a half months there, I didn’t get my parts. It’s all what we need, spare parts. This is the answer to the power supply problem,” said Guerrero.

CUC executive director Lorraine Babauta, who was present at the hearing, declined to issue any comments.

Attorney General Pamela Brown vehemently denied Guerrero’s accusation in a separate interview. She accused Guerrero of spreading “lies.”

“That’s a lie. There’s has been no purchase orders sitting at my desk. He never submitted anything to me,” said Brown.

What she knows, she said, is that Guerrero had asked CUC to sole-source a procurement contract worth $509,000 for Power Plant 2.

“Now, we can’t do that because it’s a total violation of law. He’s not acting properly under the law,” said Brown, citing that the regular procurement protocol calls for a maximum of $25,000 and the CUC procurement regulations, $50,000, to allow the sole-sourcing of contracts.

“Under any regulation, what he’s pushing for was illegal and improper,” she said.

In fact, she alleged that Guerrero made “an improper conduct” when he tried to enter a contract proceeding involving engine 8 at Power Plant 1.

“In the end, he caused the delay because of his improper conduct,” Brown said.

Guerrero allegedly contacted one of the bidders for the installation of foundation bolts at Engine 8.

Brown also dismissed as nonsense Guerrero’s suggestion that the administration is making up a situation to promote privatization.

“Nothing can be farther from the truth! We’re not fools to do that just to push for something. The governor would never do that,” she said.

She said Guerrero does not just seem to understand that the government operates by law. “He wanted to run CUC. There’s been a lot of allegations against him during his incumbency at CUC. We don’t want that to happen here,” Brown said.

In an interview with reporters at the Legislature, Guerrero said that he could no longer work with Brown. “I can’t work with the AGO, period. I did all my best but she refused all that. How can I work with somebody who does not cooperate with me?” he said.

He said he requires $800,000 to nearly $1 million to buy spare parts for the power plant, including some $250,000 “to bring all engines up at Power Plant 2.”

In yesterday’s hearing, Guerrero described the current power situation on Saipan as a “catastrophe.”

As of yesterday, he said three engines of Power Plant 1 are down: engine 8, 4, and lately, engine 3. He said that engine 3 broke down Sunday night.

“I don’t know how they can survive,” he said.

He said that, even if a contract is awarded to a private company today, the situation would not change immediately, noting that it takes 90 to 120 days to order parts for engine 3; 40 to 60 days for engine 4; and three to four months for engine 8.

Guerrero said that it would be better if CUC buys the parts now, rather than wait for a private company, which he said would eventually charge CUC for the costs under the privatization agreement.

“It says that CUC has to reimburse them over 20 years. If we do it today, actual costs would be less,” he said.

He said a private company would charge a 20-percent commission for its costs.

When asked by Rep. David Apatang if he thinks the governor’s extension of emergency declaration is necessary, Guerrero said, “All I know is CUC is in serious problem. …On a personal basis, if government pays its debt with CUC, say $15 million, it would be better.”

“What I’m asking the lawmakers is to help CUC and not under any state of emergency,” he added.

Apatang then asked if it is prudent to privatize all power plants, to which Guerrero said, “ I can’t be in the same position as the governor. I showed the figures. CUC can still be CUC.”

He said CUC can still have the power plants but it must be free from “micromanagement” and must have a “decent” board whose members possess technical knowledge and are appointed “without personal interests.”