After a lengthy oversight hearing with lawmakers on the proposed fossil fuel power plant on Tuesday, Consolidated Commission on Utilities member Simon Sanchez took to discussing the proposal with members of the Rotary Club of Guam on Thursday. 

The CCU green lit an agreement with Korea Electric Power Corp. in early September to construct and operate Guam's latest power plant. Approval from the Public Utilities Commission is needed to finalize the contract.

But concerns have been raised with the power plant ranging from its environmental impacts to the company expected to operate the new power plant, Korea East-West Power, which oversaw the Cabras 3 and 4 power plant prior to its explosion. KEWP is in a consortium with KEPCO. 

Sanchez said he voted to approve the contract because he believed it will lower power bills while providing reliable power generation. 

"You cannot separate the cost of power from the reliability of power and some of the critics of this and some advocates for 100% renewable completely ignore the reliability question," Sanchez said. 

The commissioner also highlighted other advantages to the proposed plant, including its ability to facilitate more renewable energy by assisting with power fluctuations that come with intermittent solar power generation. Improvements to the power grid are also required for GPA to go beyond 25% renewable energy integration. 

The cost of the plant is estimated at $600 million.

The agreement with KEPCO is to build, operate, and then transfer the power plant. This means KEPCO will fund, construct and then operate the power plant over 25 years.

However, GPA also will contribute about $40 million after the power plant is commissioned, according to GPA General Manager John Benavente during the oversight hearing on Sept. 10. 

After the contract period, the power plant is transferred to GPA. 

The cost over the contract length in today's dollars - including fixed capacity cost, fixed and variable operation and maintenance costs, and fuel cost - is estimated at around $3.1 billion. GPA stated that fuel efficiency and potential use of cheaper liquid natural gas would lead to overall savings for ratepayers, regardless of a projected base rate increase. 

The PUC will hear GPA's petition to approve the KEPCO agreement on Oct. 31 but three public hearings will be held on Oct. 1, 2 and 3 before then, according to PUC Chief Administrative Law Judge Fred Horecky. 

Meanwhile, Sen. Clynton Ridgell has called for the PUC to deny the proposal.

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