CUC’s $245M Solar Deal Faces Final Scrutiny

For nearly two hours on October 22, a packed conference room at the Commonwealth Public Utilities Commission (CPUC) office—joined by dozens more online—heard testimonies as the Commonwealth Utilities Corp. (CUC) is weighing a public-private partnership that would add utility-scale solar and battery storage. The financing cutoff is Oct. 31; on Nov. 20, residents and businesses will learn whether they face double-digit utility rate increases before the holidays.

Special session led by CPUC Vice Chairman Bruce Camacho alongside Commissioners Jack Angelo and James Mendiola, brought together utility consultants, lawmakers, legal experts, and frustrated ratepayers. On the table were two interconnected issues that will shape household budgets for the next quarter-century: CUC’s first comprehensive base-rate overhaul in well over a decade, and a proposed $245 million utility-scale solar Power Purchase Agreement racing against an October 31 federal financing deadline.

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Providing regional context, policy expert Simon Sanchez -drawing on 24 years of experience with Guam’s Consolidated Commission on Utilities testified via zoom in his private capacity, how Guam transformed its own energy grid.

Sanchez said CUC modeled its procurement on Guam’s solar requests for proposals, which regulators vetted before bidding. Guam now operates 85 megawatts of utility-scale solar and has awarded another 335 megawatts plus a 233-megawatt battery storage system that shifts cheap daytime solar to evening peak hours, keeping diesel generators off. Combined with a new fuel-efficient plant, the expansion is cutting Guam’s oil imports from 3 million barrels a year to 1 million. Sanchez said Guam’s latest solar bids were 17.9 cents per kilowatt-hour, making the CNMI’s 18.5-cent offer competitive, and noted that Guam’s solar farms lost only 0.5 percent of panels in Super Typhoon Mawar—quickly replaced because the contractor earns money only by selling power.

Supporters urged the commission not to let the developer’s October 31 financing window slip away. Senate Public Utilities, Transportation and Communications Chairman Sen. Manny Gregory T. Castro told commissioners that the people of the CNMI have paid for decades of feasibility studies and cannot afford further delay. Pointing to the island’s elderly manåmko' and high number of dialysis patients who rely on uninterrupted power to keep life-saving medications refrigerated, Castro argued that utility-scale solar backed by expiring federal tax credits offers immediate relief without plunging the government into deeper bank debt. He also praised Eastern Power’s track record in American Samoa, where the company trained local workers rather than relying on imported labor and noted that former CUC machinists and plant personnel who understand the local grid are already working with the team.

The human and environmental cost of unreliable power was underscored by a representative from the Saipan Humane Society, who reminded commissioners that human health, animal welfare, and agricultural survival are deeply connected. Recalling how their veterinary clinic was shuttered for nearly four months without power and water after Typhoon Mawar—even as heatstroke cases and animal emergencies surged—she noted that livestock farmers on Tinian and Rota also depend on steady electricity to run water pumps and ventilation. While acknowledging that solar panels and batteries will not prevent every storm outage, she urged the commission to view long-term energy security as essential to community survival.

An Assistant Attorney General advising CUC sought to answer community skepticism rooted in past failed CNMI development schemes. She said the project is structured so the developer bears 100 percent of upfront financial and construction risk. Eastern Power and Naftan Solar will invest $245 million, financed through a pre-approved U.S. Department of Agriculture rural renewable energy loan and federal solar tax credits, with no construction spending by CUC or the CNMI government. CUC pays only for electricity delivered to the grid at the locked-in 18.5-cent rate over 25 years and can assess liquidated damages if the contractor defaults. Although CUC would buy roughly half a billion dollars of solar power over the contract’s life, she said that remains far cheaper than imported diesel. The contract faces three legal reviews: CUC counsel, the CPUC, and final approval by CNMI Attorney General Edward Manibusan.

Even renewable-energy supporters pressed for stronger safeguards. Former CUC Executive Director Tony Muña asked what CUC will charge consumers on top of the 18.5-cent wholesale price, whether the utility can renegotiate if technology pushes solar costs down to 9 or 10 cents, and whether CUC must buy all power produced or only a minimum threshold.

Retired finance and accounting professional Noel Soria welcomed the 18.5-cent rate versus 40-cent diesel but urged CUC to release source documents showing how Fuel Adjustment Charges and generator output are calculated. To protect ratepayers over 25 years, he recommended a parent-company bank guarantee from Eastern Power Solutions backing Naftan Solar LLC, cross-default joint liability, binding operations and maintenance agreements, and a requirement that the developer pay all environmental disposal costs for toxic batteries at contract end.

Attorney James Kingman sympathized with newly seated commissioners, saying a decade of political cowardice left the CPUC defunct and forced members to compress 15 years of regulatory accountability into one moment. He encouraged skepticism but noted Oct. 31 is a standard commercial financing cutoff and that Eastern Power lacks the red flags of past unproven CNMI contractors. Delaying a legitimate partner, he warned, could damage the Commonwealth’s reputation with future investors.

House Transportation and Infrastructure Chairman Rep. Vincent Aldan said restoring a working CPUC quorum was his top priority because the utility crisis had brewed for 20 years. He backed solar and acknowledged the need for CUC rate increases but defended Chairman Camacho’s refusal to act as a rubber stamp. Aldan stressed that the 18.5-cent wholesale rate excludes transmission, distribution and utility operating costs, and said developer deadlines and political pressure must not replace engineering studies, grid-integration plans and financial guarantees. He noted the House passed bills to mandate a utility audit, replace an unrealistic $250 million privatization price tag with fair market valuation, and repeal a 1 percent Office of the Public Auditor fee on CUC gross collections that costs ratepayers up to $1 million a year—only for the measures to stall in the Senate.

The commission recessed until 9:30 a.m. Friday to finish public comments and its agenda. The larger deadlines remain: Oct. 31 for financing, and Nov. 20 for the rate decision.