Guam Utilities Commission Set To Decide On $300 Million Power Plant

Power Authority plan to address shortage of electricity reserves

By Gaynor Dumat-ol Daleno

HAGÅTÑA, Guam (Pacific Daily News, Oct. 26, 2016) – The Public Utilities Commission may decide Thursday night whether to approve the Guam Power Authority’s plan for a new $300 million power plant.

GPA continues to lack sufficient power reserves, GPA General Manager John Benavente said at a legislative public hearing Wednesday, during which lawmakers received an update on the status of the islandwide power system.

An explosion and fire in August 2015 wiped out about 80 megawatts of power supply from what were two of GPA's most efficient main power plants — Cabras 3 and 4.

Benavente said until a new power plant is in place, GPA plans to keep using a 40-megawatt mobile power plant, which the agency has been renting from Aggreko PLC since last year, at a cost of about $11.7 million a year.

GPA plans to lease the Aggreko generators for four years while the proposed power plant is being developed, Benavente said.

The new power plant proposal is on PUC's agenda for a vote during its meeting at 6:30 p.m. Thursday, on the third floor of the GCIC building in Hagåtña.

GPA has expressed a preferred location for the plant — in the Harmon cliffline area, near the northern wastewater treatment plant. The area will allow GPA to use treated, recycled water for cooling the proposed new power plant, said Joey Duenas, chairman of the Consolidated Commission on Utilities, which functions as the governing board for GPA and the Guam Waterworks Authority.

The plan to keep the mobile power plant for as long four years in Yigo, near the village gym and community center, won’t sit well with the area’s residents, said Yigo Mayor Rudy Matanane.

He said Yigo residents have complained about the noise and smoke from the temporary power plant. Depending on the time of day and the wind direction, many Yigo households within a 2-mile radius of the temporary power plant’s location can hear the plant, which runs almost 24 hours a day, the mayor said.

“It is really, really irritating — the noise can travel across two miles,” he said. Inside Yigo's community center, people can barely hear each other when the power plant is running, Matanane said.

Matanane said he understands the need for temporary power generation, but he added Yigo residents weren’t consulted before the decision was made last year to install the temporary power plant there.

“It is too loud, and one of their concerns is that there was never a public hearing,” the mayor said.

PUC’s decision will be based, in part, on how the new plant could affect the cost of power to residential, business and government customers islandwide.

GPA estimated, in a revised plan submitted to the PUC a few months ago, that the new plant could increase the cost of power by 1.8 percent of a customer’s total power bill in 2024, 1.7 percent in 2025, and 4.6 percent in 2026.

GPA submitted to the PUC plans for a 120- to 180-megawatt power plant, which will burn ultra-low-sulfur diesel and later, liquefied natural gas, when Guam infrastructure becomes ready for LNG use. Guam doesn’t have a pipeline and seaport that can handle LNG supply, which were obstacles to GPA’s previous plan to use LNG fuel for the power plant.

GPA intends to let private developers compete and submit proposals to fund, build and run the proposed power plant, which could cost more than $300 million, based on GPA estimates in May.

GPA's plan is to buy power from the privately developed plant, under an independent power producer model. GPA already buys power from existing private power producers, including Marianas Energy Co.

In addition to a shortage of power reserve supply, Benavente said GPA also needs a new power plant because the agency faces U.S. Environmental Protection Agency fines of up to $150 million

if the local utility continues to operate old power plants that don’t meet new federal standards for smokestack emissions.

Pacific Daily News
Copyright © 2016 Guam Pacific Daily News. All Rights Reserved

Rate this article: 
No votes yet

Add new comment