It was said that a failed CUC is one of the CNMI’s biggest problems, and it is killing families as well as businesses. Providing reliable, affordable power should be seen as a long-term investment in the community.
It was said that bad management and corruption are at the root of CUC’s failure. CUC has been run for too long by incompetent individuals, including unqualified board members and executive directors, and the agency requires consistent auditing to ensure accountability.
People also said that CUC’s billing practices and other policies must be thoroughly investigated and adequately explained to the public. The oversight hearings being conducted by the Legislature should be watched closely; people want results to come out of these hearings.
It was also said that CUC’s generators are dilapidated due to years of poor maintenance and that no legitimate private company would be seriously interested in buying CUC, except perhaps under a “Build Operate Transfer” scheme.
It was said that CUC has done a poor job of explaining to the public the reasons for the recent engine failures, and the action the agency took to correct them. It was also said that the government needs to do a comprehensive energy audit to identify the sources of waste along the lines, and that the government has not done enough in its own offices to significantly improve efficiency and cut costs.
Finally, it was said that people with disabilities and low-income families need more assistance to pay their power bills.
Reliable and affordable power, clean running water, and a functioning wastewater treatment system are all basic necessities that have never been properly delivered to the people of the CNMI. CUC has failed in all these areas, and not for lack of funding, but because of mismanagement and corruption.
The oversight hearings being conducted by the Legislature must be followed by serious and decisive action that gets to the root of the problem in order to be meaningful. The root of the problem is mismanagement and corruption. We all know it. We might not yet know all the specifics as to how CUC has been mismanaged and corrupted, but that is what the oversight hearings should be for, that is what independent audits and criminal investigations should help uncover.
The Legislature’s recent moves to arbitrarily lower the power rates is only a reactionary measure that is as improper and as irrational as CUC’s decision to jack up the rates as suddenly and as dramatically as it did. Throwing more money at CUC is useless and wasteful if we don’t first determinedly tackle the root of the problem. Individuals responsible for corruption or misuse of public funds should be brought to justice. Incompetent managers should be replaced with qualified people. “There is no one on-island who is qualified,” is a common excuse for hiring incompetent individuals. It’s a bad excuse. We should recruit off-island then, and allow the people we hire the freedom to properly do their jobs without political interference.
And how about some vision for a change? How about an ambitious program to promote energy efficiency for the islands, beginning with the government? How about setting bold goals and devising a strategy for cutting consumption and maximizing efficiency? How about training energy compliance officers in every agency to implement that strategy? How about establishing and enforcing a “green building code” for the CNMI that would at a minimum set strict energy efficiency standards for every new building that is constructed in the islands?
How about we stop merely talking about renewable energy and start planning and doing? How about a short- and long-term strategy for renewable energy? How about promulgating net metering regulations so that private renewable energy companies can operate and feed power back to the grid? How about incentives and technical assistance for homeowners and businesses to invest in solar power, wind energy, and biofuels? How about certification programs at the Northern Marianas College for energy auditors and renewable energy technicians? How about inviting renewable energy researchers to set up offices and demonstration projects here?
Enough with the band-aid measures and reactionary thinking. What the CNMI needs now is a visionary yet practical strategy for energy efficiency and renewable energy, and the right people to carry that strategy into action.
Read up on some of the discussions that occurred here:
This was an editorial in the Friday, October 12, 2007 issue of the Saipan Tribune.
Power cut by fiat
Your representative owes you, not his industry only, but his judgment; and he betrays instead of serving you if he sacrifices it to your opinion.
–Edmund Burke (1729 – 1797)
Saipan Tribune columnist Bruce Bateman gave this quote in his latest column and I was struck by how appropriate it was in the wake of the recent action by the Legislature to lower the residential power rates. However much you gloss it, that legislative action was nothing more than a thinly veiled vote-buying ploy intended to kowtow to voters in the run-up to the November elections. The Legislature-supposedly an august institution of 27 learned men and women-collectively abandoned common sense and betrayed their constituents by succumbing to the lowest common denominator, swayed by public opinion that flies in the face of logic, necessity, and basic economic laws. I must point out, though, that Sen. Maria Frica Pangelinan and Rep. Absalon Waki have publicly spoken out against legislating the rate cut, and opted not to participate in this rigmarole that will surely come back to bite our collective asses.
And it’s not because I don’t feel the pain of high power rates either. Believe me, each time my power bill comes due, I wince, my mind automatically cycling through all the English, Tagalog, and Waray epithets I know of and a couple of Chamorro curses on the side to make the point stick. But don’t do me any favors because what I saw last week was no blow for my paycheck; rather, it was the subservience of principles to the expediency of the moment, of people so scared of losing their seat at the legislative table that they forgot what they were there for in the first place.
Yes, the high power rates are painful and people, addicted for so many years to cheap power, felt oppressed at having to suddenly pay for the actual cost of power. But those rates didn’t just come out of thin air. They were the results of intensive study by the Economist.com consulting group that came out here to look at the island power infrastructure and the revenue that must be generated in order to meet fuel, service, and distribution requirements. The rates were implemented in order for CUC to keep the lights on day in and day out (or at least as far as how much it would cost to keep those aging, decrepit engines running). By meddling with the power rates, the delicate equation has been thrown out of whack and there will surely be hell to pay when the fuel bill comes due.
It’s not as if our lawmakers were ignorant of what will happen if they went through with the override action. CUC’s Pamela Mathis said that executive director Anthony Guerrero was up on Capital Hill several times to plead with lawmakers not to go through with the override, explaining to them the consequence of such an action. You can now see how effective that was. After all, how can one person compete against the cacophony of voices rallying in front of the Legislature? It was up to the lawmakers to have the moral backbone to stand up to all the moaning, the griping, and the whining but they spectacularly fell short of this requirement.
The Legislature is, of course, obliged to find ways to bring the power rates down but legislating the rate reduction ipso facto is not the smart or proper way of doing it. Making it so by fiat is a knee-jerk reaction that doesn’t resolve the entire problem of why we have such high power rates and how we can keep the rates down. What should have happened was the rate reduction, coupled with alternative sources for the $8 million shortfall that will result. That didn’t happen, though, effectively leaving CUC flapping in the wind and scrambling to find ways to make up for the $8 million it will need to buy fuel and maintain its aging power generation infrastructure.
The Legislature can still make up for its short-sightedness by immediately finding ways to give CUC the means to survive this huge revenue cut. Economists.com managing director Robert Young made a couple of suggestions toward this end during a presentation before the Saipan Rotary Club in October last year. According to him, one option is to borrow $70 million to buy five new power generators that burn the less expensive heavy fuel oil. Operating the new plant, he said, should cost only $43.7 million, including an estimated $6 million annual amortization. This amount represents potential annual savings of $12.3 million, if compared with Saipan’s 2006 estimated fuel cost of $56 million. CUC could also reduce system losses through better metering. CUC loses about $12.4 million in revenues annually because of unmetered load. Another way is to connect large businesses such as hotels and factories that currently generate their own electricity to CUC’s distribution infrastructure so the overall power generation cost is spread out across more customers, making it less onerous for residential users.
Whichever way, lawmakers need to act fast before darkness descends once more on this island via rolling blackouts. Looking at their track record, it is not so far off to speculate that they will then come out with another power rate adjustment bill, this time raising the power rates to where they were before and blaming people for instigating them to do the power cut in the first place. Ah, principles. Whatever happened to that?
The recent action of the legislature (see the above op-ed) reminds me of this quote:
“Talk is cheap … except when [legislature] does it.” Unknown
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