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WAPA, PSC Continue Debate on How to Lower Rates

Oct. 1, 2004 – At the Public Services meeting in Frederiksted on Thursday and Friday it was the PSC consultants vs. the Water and Power Authority consultants.
Leading the charge for the PSC was Larry Gawlick of Georgetown Consultants. He made two lengthy reports to the commission and concluded by saying that the "clock should start ticking" and WAPA officials should be held responsible for the imprudent expenditure of funds.
In remarks, which came under the heading of an assessment of the Levelized Energy Adjustment Charge, Gawlick Friday recommended:
– WAPA should immediately add a new waste heater boiler on St. Croix or explain why it will take the authority two years to install a boiler that would show immediate savings to the consumer.
– WAPA should explain why it refuses to include the slow-speed diesels as a possible high-efficiency generating technology.
– WAPA should explain its newly proposed operating criterion that would limit the maximum output of any WAPA power production facility to 80 percent.
– WAPA should without delay implement new dispatching protocols and that any failure to do so be viewed as mismanagement
All charges that Gawlick made about WAPA mismanagement causing energy losses or higher than necessary energy costs were responded to by WAPA consultants or Alberto Bruno-Vega, executive director of the Authority.
Bruno-Vega said that operating plants at 100 percent was the right thing to do if you were only looking at fuel efficiency. However, he added, "If you run the plants at 100 percent, we are going to have blackouts all over the place and power plants will be blowing up."
He used St. Croix and a normal day when it would need about 60 Megawatts of power as an example. Having four plants online with each supplying 15 megawatts would supply the power. However, if one plant went offline, Bruno-Vega said, all the plants would probably shut down. Not only would this cause a major blackout, it would cause a great deal of wear on the generators. This is the reason, according to Bruno-Vega, why five plants should be online and each running at about 80 percent of capacity.
Michael Lukey, an environmental consultant for WAPA, said the diesel-burning generators would never be licensed in the Virgin Islands and that is why they were being excluded from consideration. Speaking on Thursday he admitted they had been used on other islands with success. His main point, however, was that those islands had a sea to shore breeze only about 4 percent of the time. The sea-to-shore breeze occurs over 90 percent of the time on St. Croix and St. Thomas.
Friday morning started with Gary Norman and Thomas Davis, WAPA consultants from Harris Group Inc., presenting a slide show to the commission. According to the slides and the consultants' interpretation, WAPA is operating its plants right now at near optimal efficiency rate.
On Thursday, Gawlick talked about WAPA's generation capacity and system reliability. One statistic he produced that was not refuted from anyone during the meeting was that 30 percent of the water pumped on St. Croix is lost. He said the water loss on the St. Thomas/St. John District was near industry standards at just over 12 percent.
As far as electrical power loss, he said WAPA is losing about 14 percent, where the industry standard is around 8 percent.
"The good news is that 75 percent of this can be fixed without even leaving the office," he said. In other words, much of the loss is attributable to accounting or billing errors.
Bruno-Vega questioned whether much of that should even be counted as losses. He said most of it was legitimate business expense. He said that the WAPA business offices were not metered, nor were WAPA pumps in the field or its desalination plant.
Commission member Verne David disagreed: "If something is a loss, it is a loss, " he said.
Bruno-Vega said a plan was in place to start metering those sites so that power would disappear from the loss category.
Bruno-Vega said some of Gawlick's statements were outrageous. There were claims and counter-claims about information being exchanged or not exchanged between WAPA, the commission and the consultants. The word "liar" was thrown out a couple times.
Gawlick said the crux of the problem was cooperation. PSC Chair Valencio Jackson said he wanted to see this information-exchange problem ended.
Bruno-Vega appeared to waffle a bit when confronted with this problem. He brought up what has been the long-standing problem between WAPA and the PSC — the definition about what control PSC really has over WAPA.
Near the conclusion of the meeting, Jackson said, "The truth of the matter is that we are going to be looking at what are imprudent costs, since we are micro-managing."
The commission voted to put off until its next meeting any direct action concerning Gawlick's recommendation to "start the clock ticking" on what he referred to as "imprudent spending" by WAPA.
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