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ALJ backs single six‑month LIAC cut; MCG recommends 15.5495¢/kWh for Aug 1, 2025–Jan 31, 2026
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Summary
PUC Administrative Law Judge and Marianas Consulting Group recommended the PUC set a single Levelized Energy Adjustment Clause (LIAC) factor of 15.5495¢ per kWh for Aug. 1, 2025–Jan. 31, 2026; GPA supports the reduction but had proposed a two‑step approach. No final Commission vote appears in the provided transcript.
An Administrative Law Judge recommended June 26 that the Guam Public Utilities Commission adopt Marianas Consulting Group’s (MCG) recommendation to set a single Levelized Energy Adjustment Clause (LIAC) factor of 15.5495¢ per kilowatt‑hour for the six‑month period Aug. 1, 2025 through Jan. 31, 2026.
The ALJ said MCG concluded a single six‑month LIAC is more consistent with Tariff Schedule Z and PUC practice than the two‑step approach requested by Guam Power Authority (GPA). The ALJ reported MCG’s calculation would reduce the LIAC by about 25.53 percent and lower the overall electricity bill for an average residential customer (1,000 kWh per month) by approximately 17.40 percent.
Why it matters: LIAC adjustments directly affect retail electricity bills. GPA proposed a two‑step reduction (an initial drop in August followed by a larger drop in September) citing further fuel‑price decreases and the expected availability of a new combined‑cycle plant to reduce fuel use. MCG and the ALJ urged a single, levelized semiannual factor to match the tariff’s mechanics and to avoid multiple interim rates within the same semiannual period.
Facts in the record: GPA petitioned to reduce LIAC from 20.8802¢/kWh to 18.8781¢/kWh for Aug. 1–Aug. 31, 2025, and then to 13.584¢/kWh for Sept. 1, 2025–Jan. 31, 2026. MCG, using updated fuel‑price projections (Morgan Stanley data cited on the record), recommended the single factor of 15.5495¢/kWh for the full six months. The ALJ noted fuel prices used by GPA at filing were lower than a later five‑day average submitted before the meeting (the Morgan Stanley Singapore 10 ppm price cited on record rose from about $77 per barrel at filing to about $87 per barrel in the more recent period), which supported a more conservative single semiannual factor.
GPA’s position: GPA representatives told the commission they supported the recommended reduction overall and emphasized that the coming combined‑cycle plant (referred to in filings and discussion as the Okudu project) is expected to lower fuel consumption when fully operational. GPA said it will continue marketing and other measures aimed at lowering financing and operating costs.
Process and safeguards: The ALJ and MCG emphasized that Tariff Schedule Z contemplates one LIAC factor set for each six‑month period and that the tariff includes a mechanism allowing GPA to seek an adjustment if there is an over‑recovery (the ALJ noted an established remedy exists for significant over‑ or under‑recovery and that GPA can petition for a change if large variances appear).
Action on the record: the ALJ recommended the PUC adopt MCG’s factor of 15.5495¢/kWh for Aug. 1, 2025–Jan. 31, 2026. The transcript records GPA’s support for the recommendation but does not record a Commission vote or final order adopting the ALJ/MCG recommendation in the provided excerpt.
