By Pacific Island Times News Staff
The Public Utilities Commission has approved amendments to the energy conversion agreement between the Guam Power Authority and Guam Ukudu Power, accelerating the deadline for power project completion, with eyes set on cutting the construction costs.
The amended contract moved the commissioning date from January 2026 to Sept. 15, 2025 and a strict deadline for completion by Sept. 30, 2025. The contractor would face penalties for any subsequent delays.
By moving the date four months earlier, GPA estimated the overall project costs to drop by more than $40 million— from $571 million to $527 million.
“As of June 30, 2024 the project reached the 88.35 percent completion mark, which includes the accumulated progress of engineering, procurement, and construction of the plant and supporting infrastructure,” GPA said in a press release.
GPA and Guam Ukudu Power broke ground on the Ukudu power plant project in July 2022, marking April 2024 as the target deadline for completion. The 198 MW combined cycle plant is being built on a 45-acre property in Dededo.
However, the commissioning schedule has been rescheduled for January 2026 due to construction delays resulting from the devastating storm that barreled through Guam in May 2023. GPA earlier said some of the project’s components that were almost complete had been destroyed by the typhoon.
“With the amendments, the new plant is expected to begin testing by early 2025.
To facilitate the testing phase, fuel procurement will need to be completed by the end of 2024, coinciding with the expected completion of the pipeline, which is crucial for the plant's operations,” GPA said.
Officials said the Ukudu project is projected to generate approximately $13.6 million in fuel cost savings for GPA customers.
"Rising fuel costs impact every facet of our lives and pose a significant challenge to our island's financial well-being,” said John M. Benavente, GPA general manager.
“By securing approval for these amendments, we will not only be lowering energy bills for customers but also providing much-needed relief to families and businesses from continued escalating expenses and keeping those funds in the local economy," he added.
The current rate of 26 cents per kWh will drop to about 13 to 16 cents, saving customers an average of $130 to $102 per bill (savings are highly dependent on the cost of fuel).
GPA attributed the reduction to the retirement of Cabras and the adoption of more efficient generation methods using less expensive fuel.
Using more efficient fuel, specifically ultra-low sulfur diesel, will result in 879,000 fewer barrels of fuel imports annually.
GPA noted that the current reliance on older baseload generators requires significant consumption of expensive fuel, leading to substantial annual costs.
“Retiring Cabras 1 & 2 will directly benefit customers by reducing their bills,” GPA said.
The Aggreko generators leased by GPA will bridge the power shortfall pending completion of the Ukudu project.
Last week, GPA announced that the generations are now fully operational and integrated into the Island Wide Power System.
As part of a temporary power agreement with Aggreko, the 20MW power package has been commissioned for 24 months, featuring high-efficiency, ultra-low emission generators, GPA said.
Aggreko initiated generator performance testing and conducted internal and load testing, clearing a portion of the units over several days. Coordination with GPA dispatch was also being finalized to establish communications and ensure seamless integration. As the units were cleared they provided peak support as needed.
“Aggreko has a long history with Guam Power Authority and understood the importance of the local government’s request to deliver safely and on time within 100 days," said George Whyte, managing director of Aggreko.
"We appreciate the support of the teams on the ground who helped accelerate the rapid deployment of 20MW of power to meet all of the energy demand and minimize the risk of shortages across the country. We have used our latest technology, which includes highly efficient products that burn cleaner and less
fuel and reduce emissions,” he added.
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