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Senate Passes Amendments to Energy Bill

Sept. 7, 2005 — Amendments passed Wednesday to the Job Creation Act of 2005 could give quick relief to utility rate payers, according to Alberto Bruno-Vega, executive director of the V.I. Water and Power Authority. Among other things, the amendments will allow WAPA to solicit bids from small power providers who are not dependent on high-cost fuel to generate power.
The amendments, which were passed by the full Legislature, must be approved by Gov. Charles Turnbull before they become law.
The amendments changed the bill's original requirements that 400 jobs be created and $150 million be initially invested in the St. Croix community by a selected small power provider over a period of four years. The job requirement now commits the provider to maintaining a workforce in which 90 percent of permanent, full-time positions be given to residents of the Virgin Islands, and the $150 million investment requirement was reduced to $20 million.
Furthermore, small power providers would no longer have to be certified by the Public Services Commission prior to negotiating a purchase agreement with WAPA. However, the successful bidder must be certified by the PSC before a contract is signed.
A requirement of a $150,000 reinvestment into the territory for economic stimulus is also included in the bill. This would give money to programs on St. Croix for public schools, the homeless, and low-income housing residents.
While many senators favored the amendments — after unanimously overriding Turnbull's veto of the act in July — Sen. Norman Jn Baptiste spoke out in support of the original bill. "This will provide relief to the 3,000 plus people in St. Croix who are suffering because they don't have jobs or money to feed their families," Jn Baptiste said. "Any of the amendments proposed will gut my original intent."
Jn Baptiste first introduced the act in September 2004. He has been accused of tailoring the legislation to suit a proposal by Caribbean Energy Resources Corp (CERC). Although Jn Baptiste has denied such allegations, Bruno-Vega and Sen. Lorraine L. Berry disagree.
"We have issued three RFP's since 2004 soliciting small power providers for the territory," Bruno-Vega said. "CERC has never submitted a bid package to us. Instead, they have avoided submitting a package to us at all costs because they were waiting for this (original) bill to be passed."
Sen. Lorraine L. Berry also told members of the media that a letter submitted to Turnbull in August by CERC stated that the company is currently ready to set up shop in the V.I. — without having supplied WAPA with its proposal. "If we did not pass this amendment today, then WAPA would have had to enter into negotiations with this company alone, and that's not right," Berry said.
"The services offered by this company would push power rates even higher," Bruno-Vega added. "CERC proposes to generate power through petroleum coke, a fuel derivative. This means that the territory will still be affected by the national prices of fuel. This amendment will allow for WAPA to bid on companies who offer renewable or alternative power sources."
The use of petroleum coke for power production is also discouraged under an energy bill forwarded by the Bush administration. Some alternative sources of energy are instead being advocated — a measure that would provide federal money to territories seeking alternative energy sources.
"If we were to use CERC, we won't be able to receive any money from the federal government," Bruno-Vega said.
Continuing to speak out against CERC, Bruno-Vega said the company is also not able to build a plant that generates less than 30 megawatts of power — the maximum amount of energy a provider can supply to the territory. "The proposals we've heard call for plants being built to generate 60 megawatts of power for St. Croix alone. That would effectively shut down all of WAPA's operations on the island, as well as our ability to provide potable water for St. Croix. We need to find a better provider than this."
If the amended bill is signed into law by the governor, Bruno-Vega said WAPA will have the ability to do just that.
"What's going to happen now is that we're going to issue a new RFP for companies who want to bid, and select a company based on our own criteria. I believe that this is the quickest way to ensure that our customers will get relief from these high energy rates."
Some senators agreed that this was the most appealing section within the amendment, especially because WAPA received 31 responses to the call for bids sent out in September 2004.
However, Valencio Jackson, chairman of the PSC, is not exactly thrilled by the legislation. While Jackson said that he has not had a chance to review or give testimony on the amendments, he said anything granting WAPA the authority to issue the RFPs would eliminate the PSC's job as the utility's regulatory agency.
However, the amendment requires the PSC to approve the negotiated purchase agreement between WAPA and the selected provider.
Three other entities have been certified as small power producers—Antilles Energy Co-operative Inc, Caribe Waste Technologies, and the St. Croix Renaissance Group.
Voting for the amendments were Sens. Craig W. Barshinger, Berry, Pedro Encarnacion, Juan Figueroa-Serville, Neville James, Shawn-Michael Malone, Terrence "Positive" Nelson and Ronald Russell.
Voting against the amendments were Sens. Roosevelt C. David, Liston Davis, Adlah "Foncie" Donastorg, Jn Baptiste, Usie R. Richards, and Celestino A. White Sr.
Sen. Luis P. Hill was absent at voting time.

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