WAPA seeks to raise LEAC rate
Published: March 4, 2013
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ST. CROIX - The V.I. Water and Power Authority has asked the V.I. Public Services Commission to increase the electric Levelized Energy Adjustment Clause, or LEAC, and to lower the water LEAC for April through July.
WAPA's request is for a new electric LEAC rate of 44.4835 cents per kilowatt-hour, which WAPA executive director Hugo Hodge Jr. describes in a letter to PSC Chairman Thomas Jackson as an increase of 3.2185 cents over the current LEAC.
However, Hodge describes the increase as a percent increase that does not appear to comport with the actual percent increase that the numbers in the letter relay.
There is also a chart in the letter purporting to show "the net effect of this increase in the LEAC on our customers' monthly bill."
It is not clear how WAPA came up with the numbers in that chart, which show a "present bill" for the "average customer" in each category, the new bill for that customer under the proposed increase, how much the bill would go up, and the percent of the increase.
Some of the numbers in that chart do not appear to comport with the rates Hodge mentions in his letter.
For example, the number given for the "new bill" for an average residential customer using 400 kilowatt-hours of electricity in the chart is actually what the present bill would be under the current LEAC - not the new proposal.
It was not clear whether typos, miscalculations or other issues prompted the inconsistencies in WAPA's request.
After The Daily News first raised questions about conflicting numbers and percentages in WAPA's written request to the Public Services Commission, WAPA spokeswoman Cassandra Dunn said Friday afternoon that she did not know how the errors occurred and did not know the amount that WAPA actually will be requesting for the new LEAC.
"When they submitted the numbers and it was signed off on, they believed those numbers were correct," Dunn said of WAPA officials' petition to the Public Services Commission. "Obviously, there may have been an error in computation. I don't know what the error was."
Dunn said she would try to find out, but by press time, she still did not have answers.
On the water side, the WAPA request is to decrease the LEAC from $14.63 per thousand gallons to $11.77 per thousand gallons, according to the written request.
However, the percentage reduction in the overall bill for the average customer using 2,400 gallons also does not seem to comport with the rates given in the letter.
In an interview after a WAPA board meeting on Thursday, Hodge said that the LEAC request could change, if forecasts or other variables change.
Hodge said he did not have the numbers in front of him at that time and could not recall the specifics of the filing, but he described the request for the electric LEAC increase as between 3 cents and 4 cents per kilowatt-hour.
There had been only minimal mention of WAPA's request to the Public Services Commission - and no hard numbers on what the request was - during the board meeting.
Hodge said after the meeting that he thinks the public mistakenly thinks that WAPA sets the LEAC rates.
Actually, WAPA petitions the Public Services Commission to change the LEAC, asking for a specific increase or decrease, typically quarterly. WAPA also provides data to the Public Services Commission. The Public Services Commission, after a consultant investigates, makes the decision on what the LEAC will be.
The Daily News obtained WAPA's LEAC petition from the Public Services Commission, not from WAPA.
Dunn said that WAPA is in the midst of what she described as a "discovery phase" with the Public Services Commission that would uncover any errors in its rate requests.
"It's during this phase that any errors that may come to light are worked out between the question and answer process," she said. "And then the PSC uses the final data to make a decision on the filing."
However, more than a day after The Daily News started asking what WAPA's request actually was, Dunn said she still did not know.
The Daily News also asked about what appeared to be hesitancy on the part of WAPA officials in letting the public know just how much they are seeking to change the LEAC.
"It's not a question of WAPA not wanting the public to know what it asked for," Dunn said. "When WAPA submits a filing to the PSC, there's a process that takes place. There's also possibly changes in the cost of fuel oil or the projections based on the market that can alter the adjustment request up or down."
She said that WAPA feels that what is best for the public is for the Public Services Commission to deal with WAPA's requests first, before they are made public.
"Experience has demonstrated that it is best for the PSC to review the information first," Dunn said.
- Contact Joy Blackburn at 714-9145 or email email@example.com.