$8 power rate hike to greet Guam residents on New Year's Day

By Pacific Island Times News Staff

Beginning Jan. 1, Guam’s residential customers using 1,000 kilowatt-hours per month will see an $8 increase in their electricity bill due to a base rate increase, offset by a reduction in the fuel surcharge.

The Public Utilities Commission has approved the Guam Power Authority’s twin petitions for base rate and fuel surcharge adjustments, which will roll in simultaneously.

GPA has petitioned to raise the monthly charges from $15 to $20, but PUC amended the amount to $25, reflecting the commission’s independent review, findings and determination.

“The PUC found the base rate adjustment to be necessary to support long-term investments in modern generation, maintain system reliability and ensure financial stability as fuel-related charges continue to decline,” GPA said in a press release. 

GPA said the base rate adjustment will support its switch from older,

less efficient generation units and helps reduce exposure to volatile fuel prices.

Once fully commissioned, the Ukudu Power Plant is expected to reduce fuel consumption by more than 900,000 barrels per year, helping stabilize fuel-related charges over time.

The fuel surcharge, also known as the levelized energy adjustment clause, decreases from 15 cents to 13.5 cents per kWh.

“Customers are benefiting from a new power plant without paying more for it,” said John M. Benavente, GPA general manager.

“At a time when costs are rising across nearly every sector, GPA customers are benefiting from a new, approximately $600 million power plant while overall bills are lower than they were a year ago. Once fully online, Ukudu will continue to reduce fuel use and help stabilize costs over the long term,” he added.

On an annual basis and compared with January 2025 rates, GPA said average residential customers are still projected to realize approximately $1,200 in net savings, reflecting fuel reductions previously implemented.

In the FAQ paper, GPA noted that the new LEAC will be the third in a series of cuts, following the first two reductions implemented earlier in 2025.

“The LEAC is reviewed twice each year and adjusted up or down based on actual fuel costs and system conditions. It is designed to be a flexible, self-correcting mechanism,” the FAQ reads.

As GPA brings more efficient generation online and reduces Guam’s dependence on imported fuel, the LEAC is expected to decline and become more stable over time, helping protect customers from volatile global oil prices.

“Average residential customers are ultimately ending up in the same overall cost position GPA proposed in its petition filed last year; however, with two 

significant LEAC reductions implemented earlier in 2025, customers

received fuel savings sooner than originally anticipated,” GPA said.

John Kim, GPA’s chief financial officer, said the utility agency’s proposal was structured to align fuel savings and base rate recovery with the commissioning of the new power plant.

“The PUC’s final decision adjusted that timing by implementing fuel charge reductions earlier, delivering immediate savings to customers during the period when the commissioning of Ukudu was delayed,” Kim said.

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