💧 Water and Power · U.S. Virgin Islands
WAPA sought PSC reconsideration of fuel surcharge cut
The Virgin Islands Water and Power Authority said on December 17, 2019, that it had petitioned the Public Services Commission to reconsider the commission’s December 12 decision to lower the fuel surcharge, known as the LEAC, take no action on a pending base-rate petition, and allow a leased-generation surcharge to expire at the end of 2019.
WAPA said the PSC action would leave the utility unable to meet payment obligations to its LPG supplier, Vitol, and unable to buy propane fuel, forcing it to use more expensive No. 2 fuel oil to generate electricity.
According to the petition, the LEAC for the January 1 to June 30, 2020 period would need to be based on the cost of No. 2 oil, which WAPA said would raise the surcharge by about 20 cents per kilowatt-hour. WAPA said that, combined with the current base rate, residential customers would face an overall cost of about 57 cents per kilowatt-hour.
As an alternative, WAPA said the commission could approve a temporary surcharge of $29.7 million, or 5.7 cents per kilowatt-hour, until the PSC acted on the permanent base-rate petition. WAPA said that option would result in an overall residential cost of about 43 cents per kilowatt-hour.
WAPA said in the filing that without reconsideration or another rate adjustment, it would be unable to buy enough fuel to operate its power plants continuously, which it said would result in outages.