Senator seeks delay in approval of new power plant contract

Senator Clynt Ridgell introduced Bill No. 188-35 which seeks to prevent both the Guam Power Authority (GPA) and Guam Waterworks Authority (GWA) from back-billing its customers. (PNC photo)

Senator Clynton E. Ridgell is requesting a delay in the Consolidated Commission on Utilities’ approval of the contract between the Guam Power Authority (GPA) and Korea Electric Power Corp (KEPCO) to construct a new 198-megawatt combined cycle power plant.

In a letter to CCU chairman, Joseph T. “Joey” Duenas, Ridgell wrote that during the last oversight hearing with GPA in May, there were a lot of details that could not be disclosed about the proposed power plant.

“We are concerned that since the contract was awarded to KEPCO, many ratepayers are still left in the dark about how the construction, management, and operations of this power plant will affect our power bills and eventually, what the impacts will be to our environment and our community at large,” the senator wrote.

Discussions among GPA, the CCU, and the Public Utilities Commission (PUC) have included the possibility of securing a new 30-year bond, restructuring existing bonds, and increasing GPA’s base rate.

“They promised ratepayers that this power plant would not require an increase to the base rate. Now they are saying this power plant will likely require an increase the base rate,” Ridgell wrote.

The estimated cost for the construction of this power plant is $400 million. Ridgell said this does not even include the estimated $200 million cost for the construction of a liquefied natural gas storage and gasification facility to be placed at the port.
Ridgell also remains concerned about GPA’s desire to import liquefied natural gas. According to documents from GPA, the new power plant will allow the conversion of use of fuel sources from Residual Fuel Oil (RFO) to ultra-low sulfur diesel (ULSD) and liquefied natural gas (LNG).

“GPA and the CCU are talking about spending somewhere in the range of $600 million dollars to build a power plant based on old technology that will soon be obsolete. This proposed power plant is meant to burn fossil fuels and like the fuel it’s designed to burn, the plant, itself, will soon be a fossil, a relic of the past. Should ratepayers be forced to pay for something for 30 years when we’re not even sure we will be still be using it 30 years from now?” Ridgell asked.

He added: “There are too many unknown factors with this proposed power plant and what it will cost the people of Guam. I am calling an oversight hearing which will take place on Sept. 10, at 9 a.m. before this proposal reaches the PUC. Until that hearing date, I am urging the CCU to hold off on making a decision on approving this contract.”