CUC: No contract yet for fuel saving device
The Commonwealth Utilities Corp. has not finalized its plan to hire a consultant to install a device that is believed to reduce power consumption by 10 percent.
CUC executive director Lorraine A. Babauta said her office continues to be in discussion with the consultant, Kevin Terry of Utah, on the matter.
“The plan is to bring him here to check the site and try it in one of the engines,” said Babauta.
In an earlier interview, CUC officials said that it was Terry who contacted the agency to offer his “catalyst system” to save fuel in the power plants.
Based on initial talks, the consultant would install the fuel-saving equipment in one of the engines. If it works, then CUC would use such a device in all engines.
Babauta earlier said the initial visit and estimate would be at no cost to CUC.
The CUC said that it consumes 3 million gallons of fuel every month, which translates to about $6 million.
Last May, the CUC signed a two-year fuel supply contract with Mobil Marianas, amounting to $120 million. But this contract cost is subject to change depending on the price of fuel in the global market.
The $120-million contract was based on the May 2005 fuel price. Prices of fuel have increased since then.
CUC charges a base rate of 11 cents per kwh for residential users and 16 cents per kwh for commercial and government customers. Right now, it imposes a 3.5-cent fuel surcharge per kwh across the board.
Saipan Chamber of Commerce president Alex Sablan said that it actually costs CUC 24 cents per kwh in production.
Sablan has expressed opposition to the pending power privatization program, saying it would further drive up the cost of power by 5 cents.
The government has not acted on the proposed privatization, which would cost some $60 million over 20 years.
There is a possibility that the government may just opt to cancel the Request for Proposal. This, after the Economist.com reportedly advised the government against entering into an independent power producer contract under the RFP.
The Economist.com was tasked to review the financial status of two proposers: Telesource and Rolls Royce.
