Sept. 28, 2008 — The V.I. Water and Power Authority needs to cut its dependence on oil. That's the only way residents' electricity bills are going to go down, representatives from Hovensa said during an economic recovery fair held on St. Thomas over the weekend.
The fair was sponsored by the Ackley Media Group, and was held in response to the many phone calls from residents complaining about their high utility bills, station representatives said. Held at Tutu Park Mall, it featured a number of booths from community organizations along with a town hall meeting that allowed community members and representatives from WAPA and Hovensa to discuss the high cost of energy in the territory and what's being done to bring it down.
"We want solutions," said Clarence Payne, a St. Thomas resident who has spoken out against WAPA's recent LEAC increases. "We want a short-term plan to give us immediate relief and a long-term plan with concrete energy solutions."
He said senior citizens collecting Social Security checks have to balance spending their money between food, gas, medicine and light bills.
"We're going to continue our forms of protest in any way necessary, until this issue is solved and resolved amicably," Payne said. Residents should also look at what they can do to help conserve energy by turning off hot water heaters and installing energy saving light bulbs, Payne said.
In order for there to be a solution, the community needs to really understand the problem, said Nellon Bowry, who is the chief financial officer for WAPA. The LEAC ( Levelized Energy Adjustment Clause) gives WAPA the money it needs to pay the fuel to produce electricity. The rest of each month's bill goes to pay for everything else, including salaries and maintenance.
"We have no incentive to make the LEAC any higher than it is," Bowry said. "We at WAPA share the hurt that the community has been talking about. WAPA employees have to pay both water and power. There's no discount, so when we petition for LEAC increases, we hear it first from the inside before we hear it on the outside. But the price of fuel increases that you're seeing on your bills are solely the result of the LEAC."
The average electricity bill today is $249. Of that amount, $206 goes to pay for fuel, Bowry said.
"The bill today is less that it was four years ago — it's only the LEAC that's making it so high," he said. "Transitioning away from fuel is obviously the ultimate solution, and we started that process about a year ago, when we issued a request for proposals for alternative energy sources. The objective is to lower the price of energy and get away from fuel. We're not entertaining any proposal that uses fuel as an energy source."
The list of alternative energy companies has been cut down to six, and plans are to pick the final proposal or proposals by the end of the year, Bowry said.
Many residents at the fair asked why Hovensa can't sell oil at a lower rate to WAPA.
The refinery does have an agreement in place with the government that says it has to sell oil to WAPA at low market prices, said Alex Moorhead, representing Hovensa. The agreement has been renewed every year from 1999-2007, he said.
"WAPA's power rates are higher than any other jurisdiction in the United States, primarily because it relies on fuel oil to generate its electricity," Moorhead said. "Only 1.1 percent of utilities in the U.S. are fuel based. The majority use coal as a source of energy. WAPA paid $173.6 million for fuel last year, plus the cost of delivery. If WAPA were using coal, their bill would have been $22 million plus the cost of shipping.
"In Hovensa's opinion, in order to substantially reduce the cost of power, WAPA needs to change its source of energy. Unfortunately this will take time and the investment of millions of dollars into new generating equipment. But Hovensa will not be the source of any major relief."
Residents attending the fair participated in the town meeting discussion and also visited many of the booths that were also set up at the mall. The Department of Agriculture and local farmers' groups had booths that showed how community members can reduce their grocery bills by growing their own food. The V.I. Environmental Association of St. Thomas-St. John also had a composting demonstration that showed how to cut down on organic waste.
Back Talk
Share your reaction to this news with other Source readers. Please include headline, your name and city and state/country or island where you reside.
