CUC increases Fuel Adjustment Charge

Posted on Aug 31 2017

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Effective Friday, Sept. 1, the Commonwealth Utilities Corp. announced that the Fuel Adjustment Charge rate will be increased from $0.14605 per kWh to $0.15917 per kWh. As a result, residential customers who use 500 kWh of power per month will pay approximately $6.56 more in their monthly billing.

CUC has been notified by Mobil Oil Mariana Islands, Inc. that there has been a rise in the average fuel prices. Accordingly, CUC is required, pursuant to an order previously issued by the Commonwealth Public Utilities Commission, to increase the FAC pass through rate previously known as the Levelized Energy Adjustment Clause.

CPUC ordered CUC to adjust the FAC rate based on the price of oil. Adjustments are made when the Mean of Platts Singapore monthly pricing equals or exceeds 4.5 percent of the average per gallon cost of fuel used in the calculation of the FAC rate.

CUC first instituted LEAC in 2009 to recover fuel and fuel-related costs, a system also used by power providers in Guam and the Virgin Islands. In May 2015, the CPUC authorized CUC to change the name of LEAC to FAC to provide customers a more accurate description of the rate.

The FAC is used to fuel and serves as one of the two components that make up the CUC power bill. The second rate component us the electric base rate, which is used to fund operations, projects, and debt servicing. (CUC)

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