GPA bond bill looks to borrow $100M - KUAM.com-KUAM News: On Air. Online. On Demand.

GPA bond bill looks to borrow $100M

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by Jolene Toves

Guam - Getting our island utilities up to par means millions of dollars in investment.

Shortly after the passage and event enactment of the Guam Waterworks Authority's bond bill Senator Tom Ada introduced legislation to allow the Guam Power Authority to finance capital improvements to the island-wide power system. Consolidated Commission on Utilities chairman Simon Sanchez said, "GPA is hoping to borrow a $100 million between now and 2015 for additional capital improvements much of which is related to complying with the Clean Air Act."

Sanchez says GPA has some small generators which require about five to six million dollars worth of repairs needed to be completed by May in order to stay in compliance...but that's not all. "We have other needs that are related to finishing the smart grid and some other improvements to transmission and distribution and a big overhaul at one of our Cabras units so it remains efficient," he said.

Adding that all up GPA will need about $28 million now which he says in 2015 would be paid off as part of the $100 million dollar borrowing.  "Bottom line is we want to borrow $100 million over the next two years some money now about $30 million the rest in 2015 and this will help us comply with USEPA requirements and continue to upgrade the system," he said.

So what does this mean for ratepayers? "The borrowing we are happy to report would not require a rate increase because we have enough money in our rate to pay for this $100 million borrowing," he said.

Sanchez says this is possible because starting in 2015 some of GPA's older debt will begin to retire and GPA will go from $60 million in debt service to $40 million a year for the proceeding three year and in turn those savings will be used to borrow the $100 million. 

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