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WAPA No-Show Does Not Halt PSC Action

Feb. 24, 2005 – Representatives from the V.I. Water and Power Authority failed to appear before the Public Services Commission for a hearing Thursday. However, their absence did not deter the commission from taking several actions concerning WAPA.
PSC Chairman Valencio Jackson said he received a call at 4:45 p.m. Wednesday informing him that WAPA Executive Director Alberto Bruno-Vega had "fallen sick" as well as WAPA attorney Sam Hall, so no representatives from the company would appear at the hearing.
This upset PSC member Verne David who said, "I find it totally disrespectful that Mr. Bruno-Vega and the board of WAPA did not send any representatives to this hearing. Mr. Bruno-Vega is not an entity in himself."
Boyd Sprehn, PSC Legal Counsel, told the commission they could still go ahead and act on several WAPA issues even though no representatives were present because some of them were pressing matters.
Sprehn informed the commission that Thursday would make it a month since WAPA petitioned for a reconsideration of the PSC's Order No. 8, which prevented the utility from increasing its electric rate in December as it had planned based on a previously granted automatic levelized energy adjustment clause (LEAC) adjustment.
The PSC had to take action on the matter Thursday, because its refusal to do so , or a negative vote, could signal yet another lawsuit from WAPA., Sprehn said.
Both entities were in court last week to plead their case in one of five lawsuits the authority currently has pending against the commission charged with regulating it.
Last August, the PSC granted the automatic LEAC adjustment to WAPA so the authority could address its urgent need to correct its deteriorating cash position by recouping $19 million the authority had under-billed its ratepayers.
With the automatic LEAC adjustment, WAPA woulbe allowed to raise or lower its rates if the price of oil falls $1.75 above or below the projected price per barrel for that particular month. Since the implementation of the automatic LEAC, oil prices have soared, and ratepayers have seen a total of three increases in recent months.
In December, when WAPA proposed yet another rate hike, the PSC issued Order No. 8, suspending the rate increase for that month. (See "WAPA Rate Hike Suspended By PSC").
WAPA complied with the order, and rates were held at the November level of $0.146 per kilowatt hour in the December billings.
A subsequent increase was granted to the utility in January. However, WAPA officials filed a petition for reconsideration of Order No. 8 on Jan. 24, claiming the PSC's actions were illegal because it did not hold a hearing, as required by law, before issuing the order to the authority.
"If we deny reconsideration, WAPA is free to file yet another lawsuit tomorrow," Sprehn said. "If the PSC wants to show that its order is enforceable, it would have to grant the reconsideration and conduct hearings."
Sprehn recommended the following:
– The PSC should grant the petition for reconsideration to WAPA.
– Jackson should appoint a hearing examiner for the case.
– The hearing examiner should set a schedule for hearings, submissions of reports and briefs.
– The hearing examiner should have the right to address the biannual LEAC, including the next LEAC due for July, plus the automatic adjustments.
– The hearing examiner should report on current LEAC rates no later than May 27.
– The current rate schedule – $114.17 per month for 500 kilowatt hour residential use, and $306.39 per month for 1,200 kilowatt hours of commercial use – should remain in effect until further notice from the PSC.
PSC Member Alric Simmonds made a motion to accept Sprehn's recommendation, which the commission approved unanimously.
Sprehn told the commission that its decision would avert yet another court case.
The PSC also voted to assign WAPA $217,000 in docket-specific assessments.

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