WAPA BOARD BALKS AT PUSH FOR TALKS WITH CWT

Oct. 7, 2002 – Two proposals came before the Water and Power Authority governing board on Monday. One was met with open arms and the other, with a brick wall.
The idea advanced by Crucian Joseph E. Lanclos to build a one-stop marine service, storage and repair facility on St. Croix was welcomed as a "great idea" by WAPA board members.
The request that the board designate a committee to negotiate an agreement with Caribe Waste Technologies was met with strong opposition. WAPA for more than a year has been fending off CWT's efforts to force the utility to purchase power that would be generated by the chemical waste-processing system the company proposes to build and operate in the territory.
CWT's attorney, Adriane J. Dudley, asked the board to appoint a committee of WAPA board and/or management members to draft an agreement with CWT as first step in the company's bid to get a contract from the government. "In absence of an agreement with WAPA, the government can't proceed," Dudley told the board.
Caribe Waste Technologies was selected by the Turnbull administration to build and operate a plant or plants to process the territory's solid waste using a technology called gasification. CWT's proposal called for WAPA to buy the electricity — at an estimated $10 million to $12 million a year for 30 years — that would be produced in the waste processing. Last November, the WAPA board turned down the deal. It contended that the process is not commercially proven and that the utility is able to meet consumer demands for power on its own.
CWT petitioned the Public Services Commission late last year to review the matter, challenging allegations made by WAPA that the technologies the plant would use are unproven. The PSC in July certified CWT as a small power supplier. The PSC said CWT met the criteria: having a fixed address, meeting federal guidelines for distances between the proposed energy plants, and meeting the standards for production capacity.
WAPA lawyer Samuel H. Hall Jr. had warned the PSC members that by giving CWT the go-ahead, they were buying a cat in a bag. "We are pleading that CWT is an entity that owns no waste disposal equipment, does not own any generating equipment, owns no land in the Virgin Islands and has no finances," he said.
Now that the company has been certified as a small power producer, Dudley said, there are statutes to be met. She said WAPA is now required to meet with CWT representatives to come up with an "avoided cost" figure — that is, what it would cost WAPA to produce the power itself, rather than purchase it from the company.
Glenn Rothgeb, WAPA acting executive director, told Dudley that the utility had filed a motion for reconsideration with the PSC. Dudley said that the motion had in effect been denied, because the commission did not act on it within a required 30-day period. Rothgeb said that was news to him, and the PSC had not informed WAPA of any such thing.
Rothgeb also said WAPA may file an appeal in court on the matter.
Board member Claude Molloy disputed Dudley's contention that WAPA authorities are obliged to meet with CWT. "There's something missing," he said. "I sat through all the meetings. I'm surprised that CWT is on the agenda. It's very suspicious in view of what the administration has been doing with the landfill."
Molloy continued, "I will never vote for CWT. I wish Stridiron were here today." Attorney General Iver Stridiron is a fellow board member. "He said we aren't going to be a guinea pig. We shouldn't give way to a sham like CWT."
However, Carol Burke, board chair, said, "It is the board's responsibility to have CWT here today. We told CWT they weren't properly before the board before." She referred to a meeting last year which provoked CWT to seek the PSC certification. She asked Rothgeb if CWT was "properly" before the board now. (See July report, "PSC certifies Caribe Waste as power producer".)
Rothgeb said, "The only caveat I would put in here is that we may appeal this request."
Board member Andrew Rutnik, commissioner of Licensing and Consumer Affairs, asked Dudley if WAPA was obliged to negotiate. "When the PSC found CWT a qualified facility," Dudley said, "that meant we could sit down to negotiate. It doesn't mean that the PSC has place its imprimatur on it. It merely says that once CWT is qualified, you can sit down to negotiate."
In an atmosphere of opposition to entering into negotiations, the board decided to defer the matter to legal counsel in executive session until the board completes it deliberations on its position regarding entering into a contract to purchase electricity from CWT.
Dudley said she was "distressed by what I am hearing … After you told CWT that they weren't properly before the board, that they had to be certified" — and despite the subsequent PSC action "that compels you to move forward."
Rutnik remarked that any technology that is "out there" is going to be coming before WAPA. He referred to a Baltimore-based company, Sea Solar Power International, which wants the Virgin Islands to become the site of its first ocean thermal energy conversion plant. (See "WAPA gets another experimental power offer".)
Rutnik read aloud a letter from WSTA radio personality and station owner Athniel "Addie" Ottley strongly opposing CWT and encouraging WAPA to "continue in its efforts to resist" the company's moves. According to Ottley, "The Environmental Protection Agency has not approved the technology, and experts have stated that it would be five to seven years before the agency can even begin to analyze the system."
Dudley maintained that the process is not experimental — that it is now in use in Germany and is being implemented "all over Japan."
Marina would be next to power plant
Lanclos, president of Lanclos Marine Service Center and Lanclos Air Transport, presented his proposal to build a marina on five acres of property owned by WAPA adjacent to the Richmond power plant. He said the facility would provide services St. Croix does not now have. Aside from repair facilities, it would include a dry dock, enclosed storage for boats, a marine hardware store, cold and dry storage facilities for cargo and a "first-class" restaurant. He said he hoped to have the project operational within three years, and that it would "create job opportunities for 200 to 300 residents."
A graduate of Ivanna Eudora Kean High School on St. Thomas, Lanclos related how he worked at the nearby Johnny Harms Marina — now American Yacht Harbor — before going away to the military and to college. Burke applauded his proposal as a "very bold idea that would help St. Croix." Her fellow board members concurred and sent the measure to its economic development committee.
Lanclos also pitched an air shuttle service arrangement to the board, which referred it to its finance committee. He offered the use of his Cessna aircraft, which can carry up to seven passengers, at $850 an hour for a minimum of 10 hours a week.
Officers to continue another year
The board also held elections, voting to retain the present officers for the next term: Burke as chair, William Lomax as vice chair and Rutnik as secretary. Voting in the affirmative were Burke, Alphonso Franklin, Gerard Luz James, William Lomax, and Andrew Rutnik. Molloy voted no. Members Ira Hobson, commissionerof Housing Parks and Recreation, and Stridiron were absent.
As soon as the board took up one item on its agenda, the subject of the discussion objected strenuously. The item was review of the contract of Robert Vodzack, WAPA's c
hief financial officer. "I am upset that this is on public record," Vodzack said. "Someone on the board failed to do their job. Why is it here, and not in executive session?"
In the heated discussion that ensued, some board members said they weren't asking that the contents of the contract to be divulged openly and that there was nothing wrong with discussing it in open session. Rutnik interjected that since the issue had created a dispute, the contract should be discussed in executive session, and the board then voted to do so.
In other action, the board:
– Authorized implementation of WAPA's rate increase approved by the PSC, contingent upon certain conditions to be discussed with the commission. The PSC approved the utility's request for a monthly surcharge of about $1.50 on residential customers' electric bills for 90 days, effective Oct. 1, with the revenues to go toward the costs of street lighting, which by law became a WAPA responsibility last December.
Rothgeb said priorities for street lights would be the town areas on all islands, followed by heavily populated areas such as the housing communities.
– Approved a 20-year lease for the utility's administrative offices building in Sunny Isle on St. Croix. There are plans to renovate the building, expanding the office space. The board also approved the reprogramming of $737,000 from 1998 bond proceeds for the renovation work.
– Authorized payment for the RW Beck Periodic Reports on the utility's electric and water systems. Terms of the 1998 bond issue include a requirenent that reports be prepared every three years.

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