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HomeThe Big StoriesUPP says new PPA means fuel variation can go down

UPP says new PPA means fuel variation can go down

The United Progressive Party (UPP) is once again demanding that the fuel variation tariff be lowered especially in light of the new Power Purchase Agreement (PPA) which was signed with the Antigua Power Company (APC).
The party’s spokesman on the West Indies Oil Company (WIOC) Dr George Daniel said that the government of Antigua & Barbuda had once argued that the charge could not be lowered as the Antigua Public Utilities Authority (APUA) had potentially massive debts to APC.
Now that APUA and APC have abandoned an upfront settlement and agreement to a new PPA, Dr Daniel has charged that while there is major benefit to APUA “what is left out of the whole picture is any benefit to the consumer”.
Dr Daniel said, “Remember, at one time we were told that the reason why they can’t lower the tariff – the fuel variation– is because we’re looking at this over $200 million debt to APC? The huge debt is no longer there.”
According to him, with the debt to APC was settled by way of the new PPA, there was no need for APUA to seek revenue to meet the debt by keeping the fuel variation so high.
He said, “The fuel variation is excessive. We’re paying 60 cents per kilowatt-hour fuel variation when a reasonable rate would be a lot less.”
The spokesman argued that 50 cents would be a more appropriate rate.
 At an APUA press conference this week, the Minister of Public Utilities Sir Robin Yearwood argued that when the present administration took office, fuel variation was at 81 cents and has been brought down to 60 cents.
Meanwhile, Dr Daniel admitted that the new settlement arrangement between APC and APUA was beneficial to both parties. Based on calculations, which he made from figures given at the recent press conference, he surmised that for the coming years “APUA’s revenue stream looks good”.
At the conference, APUA’s Electricity Manager Andre Matthias said that in the new PPA for APC’s JV plant “the annual guaranteed amount of energy is 130 gigawatt hours up to February 2019 and 170 gigawatt hours up to 2031”. He added that the rate to APUA is 5.9 cents per kilowatt hour and that in 2031 the JV plant will be turned over to APUA.
The electricity manager also said, “We anticipate…in 2019 we’ll have about 380 gigawatt hours of annual demand. There is a PPA with APC for their JV plant to guarantee 170 gigawatt hours per year. So roughly 210 is left for APUA. Out of that, 20 will be renewable energy. So the rest of – about 200 – 190 gigawatt hours – it will be left for the Blackpine power plant and the Wadadli Power Plant both under APUA.”
 
(More in today’s Daily Observer)

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