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Charlotte Amalie
Monday, May 23, 2022
HomeNewsArchivesSOUTHERN ANXIOUS TO MOVE AHEAD ON WAPA DEAL

SOUTHERN ANXIOUS TO MOVE AHEAD ON WAPA DEAL

Dave Dunbar, Southern Energy's point man in the negotiations to buy 80 percent of the Water and Power Authority, told members of the business community Monday that no deadline has been set to close the deal, but that Southern is anxious "to see this move ahead."
However, Southern Energy reportedly sent a letter to the administration saying if Gov. Charles W. Turnbull did not send the legislation authorizing the sale to the Senate by Monday, the company would seriously reconsider its offer.
Addressing a luncheon meeting of the St. Thomas-St. John Chamber of Commerce, Dunbar also said that while the agreement calls for WAPA to retain ownership of utility poles, Southern Energy will make capital contributions to make sure all areas of the islands can receive power, even if WAPA can't afford to pay for the improvements or additional poles.
Dunbar used his time at the podium to tout the programs that Southern Energy has put in place elsewhere, including a science and technology park in Trinidad that has brought new high-tech business to that island.
The most important thing to entice new business to the Virgin Islands, he said, would be a more stable supply of water and electricity, which "doesn't happen overnight."
He said Southern would also offer improved customer service, including key account managers who would be assigned to large users to help them better manage their power usage.
Dunbar said electricity rates would remain stable through 2001 and would then go up based on 75 percent of the Consumer Price Index. He said, however, that the rate stabilization does not include the "levelized energy adjustment clause" surcharge that is tied to the cost of fuel.
Water rates would increase 10 percent in two years and would then remain stable for the next 23 years, he said.
Dunbar repeated the terms of the agreement that have become common knowledge: a cash payment of $105.3 million for an 80 percent share of WAPA, to include a 25-year lease agreement and franchise to sell water and power.
The agreement, he said, is still contingent on agreement by the Federal Emergency Management Agency to continue to cover losses to the distribution system — mainly poles and lines — in the event of disaster. It is also dependent on Hovensa's agreeing to provide fuel to the new entity, to be called Virgin Islands Electric and Water (VIEW), at the same rate WAPA enjoys. He said he is confident both items can be resolved satisfactorily.
Dunbar said if the Senate approves the legislation the governor is expected to send down, it will take 30 to 45 days for Southern Energy to put the financing in place to close the deal.
The complete details are available at the V.I. government's website. You can access the site by clicking here.

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Dave Dunbar, Southern Energy's point man in the negotiations to buy 80 percent of the Water and Power Authority, told members of the business community Monday that no deadline has been set to close the deal, but that Southern is anxious "to see this move ahead."
However, Southern Energy reportedly sent a letter to the administration saying if Gov. Charles W. Turnbull did not send the legislation authorizing the sale to the Senate by Monday, the company would seriously reconsider its offer.
Addressing a luncheon meeting of the St. Thomas-St. John Chamber of Commerce, Dunbar also said that while the agreement calls for WAPA to retain ownership of utility poles, Southern Energy will make capital contributions to make sure all areas of the islands can receive power, even if WAPA can't afford to pay for the improvements or additional poles.
Dunbar used his time at the podium to tout the programs that Southern Energy has put in place elsewhere, including a science and technology park in Trinidad that has brought new high-tech business to that island.
The most important thing to entice new business to the Virgin Islands, he said, would be a more stable supply of water and electricity, which "doesn't happen overnight."
He said Southern would also offer improved customer service, including key account managers who would be assigned to large users to help them better manage their power usage.
Dunbar said electricity rates would remain stable through 2001 and would then go up based on 75 percent of the Consumer Price Index. He said, however, that the rate stabilization does not include the "levelized energy adjustment clause" surcharge that is tied to the cost of fuel.
Water rates would increase 10 percent in two years and would then remain stable for the next 23 years, he said.
Dunbar repeated the terms of the agreement that have become common knowledge: a cash payment of $105.3 million for an 80 percent share of WAPA, to include a 25-year lease agreement and franchise to sell water and power.
The agreement, he said, is still contingent on agreement by the Federal Emergency Management Agency to continue to cover losses to the distribution system -- mainly poles and lines -- in the event of disaster. It is also dependent on Hovensa's agreeing to provide fuel to the new entity, to be called Virgin Islands Electric and Water (VIEW), at the same rate WAPA enjoys. He said he is confident both items can be resolved satisfactorily.
Dunbar said if the Senate approves the legislation the governor is expected to send down, it will take 30 to 45 days for Southern Energy to put the financing in place to close the deal.
The complete details are available at the V.I. government's website. You can access the site by clicking here.