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GPA reports Hanwha contract terminated; Okudu commissioning, KEPCO and other projects remain part of grid plan
Summary
Guam Power Authority said its contract with Hanwha was terminated after a missed milestone; GPA received $4.6 million in development security and is pursuing other generation projects including a 132 MW KEPCO project and Okudu commissioning tests.
Guam Power Authority officials told the Guam Public Utilities Commission on April 24 that the utility has terminated its contract with Hanwha after the developer missed a milestone, and that GPA received development security funds of roughly $4.6 million.
GPA reported receiving $4,600,024.16 on April 16; letters of credit were returned to Hanwha’s banks on April 22–23, the utility said. GPA staff said they tried multiple options to salvage the project but ultimately concluded it was not economically feasible for Hanwha and that a notice of default and eventual termination followed.
GPA representatives framed the Hanwha termination as a setback but not fatal to the utility’s broader consent-decree planning. GPA is advancing other projects including a 132-megawatt KEPCO project and ongoing negotiations with CoreTech for a project estimated at about 60 megawatts; most new projects include battery storage, GPA said. The Hanwha project had been expected to supply about 41 megawatts.
GPA updated the commission about commissioning tests at the Okudu Power Plant. Staff said Okudu completed simple-cycle testing and is transitioning to combined-cycle testing; the combined-cycle contract capacity is 98 megawatts, and Okudu has tested up to 145 megawatts during simple-cycle runs. Okudu’s target commercial operation date remains mid-September—September 15 is the early-incentive target, with September 30 the drop-dead date after which liquidated damages would apply, GPA said. Staff described additional commissioning tests that could be scheduled at night and during shoulder months to accelerate full commissioning and potentially reduce fuel costs for ratepayers.
Commissioners asked about EPA consent-decree implications for retiring the Cabras units. GPA staff said the consent-decree objective was primarily to close Cabras 1 and 2 and that GPA has proposed other mitigation measures to EPA; they reported EPA has shifted priorities and is not giving the consent-decree case immediate attention but that GPA will follow up monthly. GPA said it plans to file a petition to the PUC in May related to near-term operations and testing plans.
Commissioners and staff also discussed fuel-supply management during retirements and the logistics of accelerating Okudu testing without forcing fuel shortfalls. GPA said it is scheduling testing to balance available solar and system limits and that some older units are offline for maintenance ahead of summer demand.
