OPA: Rising Fuel Costs Continue to Be GPA’s Biggest Challenge

160

Guam –  The latest audit released by the Office of Public Accountability [OPA] notes that the cost of fuel druing FY 2013 increased by $6.9 million dollars. he auditors conclude that  “rising fuel costs continues to be the authority’s biggest challenge”.

The independent audit conducted by Deloitte and Touche, fond that GPA ended the 2013 Fiscal year with a “significant increase” in its net income which stood at $4.9 million at the close of the fiscal year compared to a net income decrease of $2.4M in FY 2012.

And the auditors note that despite a modest decrease of 1% in consumption,  electricity sales increased 2%  because of  “the rising cost of fuel”.

READ the OPA’s highlights of the GPA audit HERE

Deloitte and Touche rendered an unmodified or “clean” opinion on GPA’s financial statements, and report on compliance for major federal programs. They also note that in October of last eyar the U.S. Department of Energy removed GPA’s high-risk status.

However in its report on internal controls, the auditors identified one recurring deficiency pertaining to weaknesses in computer controls and access to GPA’s Utility system. The auditors also issued a management letter that identified 11 findings, of which seven are repeat findings.

READ the Management Letter HERE

Audit Highlights:

*  FY 2013 –  nearly all categories of GPA’s consumer base experienced a nominal increase in electric sales by 2% or $10.9M in FY 2013 compared to 12% or $46.2M in FY 2012. This can be attributed to the growth in GPA’s base rates and consumer base and not the increase in kilowatt consumption.

* Sales to the U.S. Navy saw a decrease of 1% or $1.1M.

* Commercial sales increased by 5% or $8.2M.

* GPA’s residential customers and the Government of Guam increased by 3%, or $3.7M and $179 thousand (K), respectively.

* In addition to the increase of electricity sales, there has been a growth in GPA’s customer base by 77 customers

* Although there is a slight increase in GPA’s consumer base, the high fuel cost has forced GPA’s customers to take aggressive measures to reduce power usage through energy-efficient equipment purchases and seek energy alternatives such as solar energy.

* GPA’s consumption by kilowatt hours (KWH) showed a downward trend over the last five years with an average decline of 17.2M KWH per fiscal year.

* For the current year, KWH consumption declined by 7.9M, going from 1.563 billion (B) to 1.556B in FY 2013.