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Thursday, March 23, 2023
HomeNewsArchivesWAPA Amends Cost of Propane Project for Improvements, Adverse Conditions

WAPA Amends Cost of Propane Project for Improvements, Adverse Conditions

V.I. Water and Power Authority board members voted Thursday to expand the budget for their ongoing propane conversion project, amending the contract they have currently with Vitol Virgin Islands Corp from $87 million to $150 million.

According to officials, “unforeseen circumstances” that came up during the project – from rough terrain on St. Croix and St. Thomas to bad weather – resulted in increased costs. Improvements, which also cover permitting costs and materials needed to complete the project, are also factored in.

Calling the propane conversion one of the “most important” energy projects in the Caribbean, WAPA Executive Director Hugo Hodge Jr. also explained that while the change means pushing back the deadline set for the authority to pay back its portion of the project costs, it doesn’t change the impact it will have on customers’ bills.

“I want to assure our customers that the adjusted project budget will not impact the amount of savings expected for WAPA customers, or the improvements to air quality that the conversion project will deliver for the territory,” he said after Wednesday’s meeting on St. Thomas.

“We continue to anticipate a 30 percent reduction in the cost of fuel and a 20 percent reduction in greenhouse gas emissions,” Hodge said. “While the amortization period will be longer, the economic and environmental benefits will not be forfeited,” he added.

Vitol is still paying all upfront costs associated with the project and WAPA will now have 10 years instead of seven to pay its share back.

The board also approved a change order that would push back until February the manufacturing time for a fleet of new pole trucks and authorized Hodge to petition the Public Services Commission for an 18-month extension to an existing generator lease.

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