The Guam Power Authority is recommending no change to the Levelized Energy Adjustment Clause, or LEAC, through July 31, citing the stabilizing impact of the Ukudu Power Plant amid global fuel market volatility.
GPA General Manager John Benavente said the utility will maintain the current LEAC rate while monitoring fuel prices following recent geopolitical tensions between the United States and Iran.
Fuel markets saw sharp increases in early March, with rising ultra-low sulfur diesel prices raising concerns about potential impacts on Guam’s energy costs.
Despite those pressures, GPA said the 198-megawatt Ukudu facility — which came online in late December — is helping reduce fuel consumption and cushion ratepayers from higher costs.
“Ukudu is proving to be a game-changer for Guam’s power system,” Benavente said. “The efficiency of this plant is helping shield our residents and businesses from much larger increases that would have otherwise occurred.”
Under GPA projections, a residential customer using 1,000 kilowatt-hours per month could see bill increases ranging from about $11 to $39, depending on global fuel trends. The utility said the Ukudu plant is reducing potential impacts by more than half.
GPA also estimated the plant could lower system fuel exposure by more than $50 million in the coming months compared to operating without it, translating to about a 53% reduction in customer impact under modeled scenarios.
Officials said liquidated damages tied to delays in the plant’s completion are being applied to offset fuel costs incurred while older, less efficient generators were used.
“Our customers should not bear the cost of a delayed project,” Benavente said, noting the funds are intended to prevent ratepayers from absorbing additional fuel expenses.
GPA said it will continue monitoring global fuel markets and provide updates as pricing data becomes available.