Guam Power Authority residential customers could see as much as a $53 savings in monthly power bills beginning Aug. 1, following the Guam Public Utilities Commission’s approval of a flat Levelized Energy Adjustment Clause.
This marks the second LEAC decrease this year.
On June 26, PPUC commissioners approved a rate of $0.155495 per kilowatt-hour for Guam Power Authority customers, effective Aug. 1 through Jan. 31, 2026. The PUC voted on GPA’s request, following recommendations from its consultant and administrative law judge.
According to the GPA press release, the PUC’s decision to set a single rate was based on several factors, including the consultant’s finding that a flat rate is consistent with the structure and purpose of the LEAC program, which is designed to stabilize energy costs over time. The consultant also cited the risk of international fuel price volatility following recent Middle East conflicts as a reason to adopt a more conservative approach.
“We respect the PUC’s role in reviewing every filing thoroughly and ultimately making decisions they feel is in the best interest of ratepayers,” said John M. Benavente, general manager of the Guam Power Authority. “We will continue to monitor market trends and fuel costs closely, especially as the Ukudu Power Plant moves closer to commissioning.”
The Ukudu Power Plant, expected to come online later this year, is projected to reduce fuel use by more than 900,000 barrels annually and is a key part of GPA’s long-term strategy to provide more reliable and affordable energy. GPA said it will reassess the LEAC rate if fuel costs drop significantly after the plant begins operations.
The PUC noted that the decision to set a flat LEAC rate also affects GPA’s broader strategy, which includes a proposed base rate increase to support repayment of financing for the Ukudu Power Plant once it is commissioned.
In February, GPA sought a decrease in the LEAC from what was $0.261995 per kilowatt-hour to $0.208802, which resulted in a roughly $53 reduction for residents using about 1,000 kWh. The LEAC is a pass-through cost that is tied to the price of oil and makes up a significant portion of the average power bill, GPA officials have said. The LEAC reflects fuel-related costs and fluctuates based on market conditions and fuel recovery needs.
Another portion of the average power bill is the base rate, which GPA uses to fund utility upgrades, maintenance and operations.
GPA has maintained its base rate at $0.10 since 2013, although officials have said they plan to seek a slight base rate increase to help pay for the debt service and other fixed costs associated with the new Ukudu Power Plant once it begins operations.
GPA officials have taken note of the public's concerns and the inconvenience caused by current capacity issues resulting in rotating outages.
“… we emphasize the critical juncture in our growth and reiterate that this setback is indeed momentary. Unlike the challenges and solutions that Guam residents confronted in the 1990s, we are eagerly anticipating the commissioning of the Ukudu power plant, poised to address our current generation capacity issues,” officials stated in a release earlier this year. “Thereafter and following a 50-year tenure of service to the people of Guam, the Cabras plant will soon be retired, signifying a new era of cleaner and more reliable energy.”
According to GPA officials, the 198 megawatt power plant will:
• Lower ratepayer costs
• Reduce fuel consumption through efficient machine technology
• Bring GPA into compliance with environmental regulations
• Include 25MW battery energy storage for immediate back up power
• Treat waste water for cooling and reduce sewer water ocean outfall
• Reduce water draw from aquifer
• Reduce Guam's carbon footprint by cutting oil imports by more than 500,000 barrels annually
Construction of Ukudu is expected to be completed sometime around September 2025 and January 2026. mbj
Flat LEAC rate approved by Guam PUC could reduce power bills
Flat LEAC rate approved by Guam PUC could reduce power bills
- Date Posted: Jun 26, 2025
- News: Guam
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Flat LEAC rate approved by Guam PUC could reduce power bills
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