Oct. 9, 2004 V.I. residents will see a 4.3 percent increase in their electric bills in October. According to a press release from the Water and Power Authority, commercial and large power customers will see an increase of 3.6 percent and 4 percent respectively.
Residents might not know what the category in their bill called LEAC really means. (It is the Levelized Energy Adjustment Clause). But they do know they don't like it. It is the first subject that comes up at meetings of a new ratepayer association, and it is the reason that the Public Services Commission has vowed to monitor what appears to them as "imprudent costs" incurred by WAPA officials.
In a Sept. 22 letter to PSC Chairman Valencio Jackson, Alberto Bruno-Vega, WAPA executive director, said the adjustment effective Oct. 4 is an automatic LEAC adjustment permissible when the price of fuel increases by more than $1.75 per barrel
According to the release, the LEAC represents the delivered price of fuel oil per barrel from the Hovensa oil refinery and is proportionately shared by all WAPA customers. The September delivered price for oil from the refinery increased to $43.98 per barrel. The projected LEAC cost was $40.11 per barrel. Therefore, the new LEAC factor for the month of October is billed at $.125359 per kilowatt representing a 7 percent increase in the LEAC factor.
According to Bruno-Vega, the cost of fuel continues to skyrocket, recently reaching an all-time high of $53 per barrel. He stressed the importance of energy conservation as a way to lessen the impact of the fluctuating oil market on customer usage.
Residential customers using the average 500-kilowatt monthly will see an increase of $4.29 in their overall bills from $105.35 to $109.64. Commercial customers using the average 1200-kilowatt will see an overall increase of $10.30. The increase in the LEAC will increase the billing for residential water customers using an average of 2,400 gallons per month by 2.7 percent or by $1.15.
Besides the higher cost of fuel, under-collection of money owed WAPA contributes to the higher LEAC factor, Bruno-Vega said.
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