Despite a price freeze, CUC raised its Fuel Adjustment Charge this month — a move Chief Financial Officer Betty Terlaje says is legal and necessary as fuel costs outpace rates. The increase caused immediate public backlash, prompting questions about whether CUC was sidestepping Gov. David Apatang’s price‑freeze directive.
Terlaje said Thursday that the FAC adjustment does not violate the executive order because it is not a discretionary price hike but a formula‑driven pass‑through of actual fuel costs.
At a special CUC board meeting on May 21, a board member pressed CUC officials on why the FAC was raised while the price freeze remains in effect. Terlaje said the confusion is understandable but misplaced, noting that price gouging involves raising prices to profit from high demand — something she said CUC is not doing.
She said the FAC is determined by a fixed methodology, so the governor’s price freeze does not apply.
The FAC rose to 44 cents per kilowatt‑hour on May 15 under a Commonwealth Public Utilities Commission order, still well below the actual fuel cost of 60.48 cents. Terlaje said the gap means CUC is losing money on every kilowatt‑hour delivered.
“We’ve already lost the 20 cents we were under‑recovering for April,” she said. “And now we’re losing another 16 cents for May.”
She warned that the under‑recovery is draining funds needed for operations, repairs and restoration. “We’re tapping into that and borrowing to keep afloat,” she said. “We are at a point where we’ve obligated more than our cash on hand and more than what we expect to collect.”
Terlaje urged the CPUC to approve FAC adjustments at the full calculated rate to prevent deeper financial strain. The CPUC last week approved CUC’s March 31 petition to raise the FAC from 24.5 cents to 44.489 cents, reflecting April’s global ultra‑low sulfur diesel prices, which doubled from March.
CUC maintains that the FAC is governed by statute and CPUC regulation — not by the governor’s disaster‑period price freeze on goods, services, and rentals.
