CUC increases fuel charge


Power customers of the Commonwealth Utilities Corp. can expect to see an increase in their power bill later this month after the utility agency increased its Fuel Adjustment Charge for February.

CUC’s Fuel Adjustment Charge, or FAC, for January was at $0.15512 per kilowatt-hour. This went up to $0.16381 per kWh effective yesterday. The FAC was previously known as the Levelized Energy Adjustment Clause, or LEAC.

As a result, residential customers who use 500 kWh of power per month will pay approximately $4.35 more in their monthly billing.

According to a statement CUC released yesterday, the move was prompted by a notice from Mobil Oil Mariana Islands Inc. that there has been a rise in average fuel prices.

The Commonwealth Public Utilities Commission previously allowed CUC to adjust its FAC rate based on oil prices, based on the Mean of Platts Singapore, or MOPS, the average of a set of Singapore-based oil product price assessments published by Platts, a global energy, petrochemicals, metals and agriculture information provider. If MOPS’ monthly pricing is equal or more than 4.5 percent of the average per gallon cost of fuel, adjustments are to be made by CUC.

CUC instituted the LEAC back in 2009 to recover fuel and fuel related costs. Power providers in Guam and in the Virgin Islands also utilize LEAC, which was changed to FAC last May 2015 to provide an accurate description for costumers.

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

Erwin Encinares | Reporter
Erwin Charles Tan Encinares holds a bachelor’s degree from the Chiang Kai Shek College and has covered a wide spectrum of assignments for the Saipan Tribune. Encinares is the paper’s political reporter.

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