CUC announces power-rate hike
30 Dec 2016
- By Junhan B. Todiño – firstname.lastname@example.org – Variety News Staff
THE Commonwealth Utilities Corp. on Thursday said it will increase its fuel-adjustment charge or FAC pass-through rate.
The increase from $0.14323 per kWh to $0.15512 per kWh is a result of an increase in fuel prices, CUC said in a statement.
CUC said residential customers who use 500 kWh of power per month will now pay approximately $5.94 more on their monthly bills starting Jan. 1, 2017.
The fuel-adjustment charge previously called the Levelized Energy Adjustment Clause or LEAC was first instituted in 2009 to recover fuel and fuel-related costs.
This system is also used by power providers in Guam and the U.S. Virgin Islands, CUC said.
In May 2015, the Commonwealth Public Utilities Commission authorized CUC to change the name of LEAC to FAC to provide customers with a more accurate description of the rate.
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.
CPUC granted CUC the ability 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 said although there is a slight increase in the FAC rate, CNMI consumers have experienced a decline in the FAC since mid-2014.
Early this month, following a decrease in the average fuel prices, CUC reduced the FAC rate from $0.15063 per kWh to $0.14323 per kWh.