March 8, 2006 — During a Committee of the Whole meeting Thursday, representatives from the Virgin Islands Water and Power Authority said they need another 60 days to finalize a power purchase agreement with Innoventor Technologies, the company recently selected by WAPA to be the small-power provider for St. Croix.
Innoventor was chosen under terms called for in the Jobs Creation Act, which stipulates that WAPA submit a negotiated contract with the company to the Public Services Commission by Feb. 16 (See "WAPA, Innoventor Seek 60-Day Extension to Finalize Agreement").
However, Alberto Bruno-Vega, WAPA's executive director, told senators that the two entities still have to iron out some details – like whether or not the wind turbines would be able to withstand hurricane conditions. "That's one of the reasons that we need more time," he said. "But we are close to reaching an agreement."
Paul Engler, a principal of Innoventor, expounded on Bruno-Vega's statement by explaining that there is currently no wind turbine supplier that can, or will, guarantee that their machines could withstand 150 mile-per-hour winds. "This is the crux of the matter," Engler said. "Furthermore, in our original proposal, we had outlined building turbines with 1.65 megawatt capabilities. Since these are somewhat smaller turbines, which may not hold up in a hurricane, we need to decide whether we need to go bigger."
Despite these concerns, however, Bruno-Vega told senators that he is confident that Innoventor is the right company for the job and can bring about savings for ratepayers. He said that Innoventor proposes a flat rat of 10.93 cents per kilowatt hour, which would translate to a monthly savings of 19 cents for the average customer. "That may not seem significant, but it is," he said. "Especially in comparison to the other proposals we received, which would increase rates by at least $3."
A letter submitted to Sen. Lorraine L. Berry by members of the PSC before Thursday's meeting stated that WAPA rates "are already higher than any other American utility that we are aware of, and will continue to climb as the current rates are still behind the present price of fuel."
Bruno-Vega further told senators that if the extension were not approved, then WAPA would have to scrap negotiations with Innoventor and send out new bids for small power providers. "We've already been caught up in this process for two years," he told Berry. "To have to go through it again would have a huge financial impact on both WAPA and the people of the Virgin Islands, as rates will continue to increase."
Bruno-Vega explained that WAPA experienced some delays in the bidding process after sending out a Request for Proposal (RFP) for small-power providers in 2004. "First we had a disagreement with the PSC, who thought they had the authority to issue RFPs on behalf of WAPA – that case is still pending in the Superior Court on St. Croix," he said. "Then there were a series of bills passed by the Legislature, which also affected the bidding process – including the Job Creations Act, which imposed a very strict timeline for when a provider should be selected."
Bruno-Vega also said that the delays could have been avoided if the Legislature had granted WAPA full authority to proceed with the bidding process after the RFP was issued in 2004. "WAPA is frustrated – at every step we have had to go to the Public Services Commission for approval. If we had been given the full authority to proceed with the process from the beginning, we would have had a provider selected already," he said.
After the testimony, senators went from Committee of the Whole into full session, where only Sens. Norman Jn Baptiste and Celestino A. White Sr. voted against the extension, which will go into effect after it is signed by Gov. Charles W. Turnbull.
All senators were present at both the Committee of the Whole meeting and the full session Thursday.
Editor's Note: The Source originally reported that senators voted unanimously in favor of the extension. In fact, White and Jn Baptiste voted against the extension. Jn Baptiste changed his vote after voting in favor of the extension initially.
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