I Liheslatura’s Policy

I Liheslatura supports, in principle, the development of alternate energy, but is concerned that the alternate energy program not be a burden upon the taxpayers, power consumers, and residents of Guam. Therefore, I Maga’håga/Maga’låhi, the government of Guam and the Guam Power Authority may enter into alternate energy agreements to develop alternate energy or to purchase alternate energy only if all of the following conditions are met:

(a)Local funds of the government of Guam or the Guam Power Authority Funds may be used to develop alternate energy sources (including power generated from windmills, solar ponds and Ocean Thermal Energy Conversion) as may be later, appropriated by I Liheslatura or approved by law for that specific purpose.

(b)Any power produced or sold from alternate energy sources (including power generated from windmills, solar ponds and Ocean Thermal Energy Conversion

(OTEC)cannot be purchased by Guam Power Authority or the government of Guam at a cost greater than the average cost of producing power found in the islandwide power system (not inclusive of backup diesel generators), specifically the two Cabras Units, the two Tanguisson Units, and the Piti Power Plant. CH. 8 GUAM POWER AUTHORITY

(c)No contract may be signed by the government of Guam or the Guam Power Authority to develop or purchase power from alternate energy sources (including power generated from windmills, solar ponds and Ocean Thermal Energy Conversion), if such contract will result in increased expenses and costs for the Guam Power Authority. No such alternate energy contract may be signed until the board of directors of the Guam Power Authority has so certified that the agreement is consistent with all bond covenants and that the price paid for electricity pursuant to the agreement does not exceed actual current avoided cost.

(d)For so long as the Navy Power Pool Agreement is in effect, neither the Guam Power Authority nor the government of Guam may contract to purchase any power generated from alternate energy source (including power generated from windmills and solar ponds and Ocean Thermal Energy Conversion) without giving the United States Navy prior written notification.

(e)Any contract to purchase alternate energy (including power generated from windmills and solar ponds and Ocean Thermal Energy Conversion) must provide that any loss or damage to the islandwide power system, Guam Power Authority and the U.S. Navy or to consumers as a result of or proximately caused by the negligence of alternate energy supplier or by the quality of alternate energy supplied will be borne solely by the alternate energy supplier who will hold Guam Power Authority and the government of Guam harmless.

(f)All interface facilities to provide usable alternate energy (including power generated from windmills, solar ponds and Ocean Thermal Energy Conversion) shall be installed and maintained at the expense of the supplier of alternate energy. Any such interconnections shall be at existing lines owned and operated by the Islandwide Power System, and such interfaces shall be subject to the engineering standards and approval set by the Guam Power Authority.

(g)Any contract to purchase alternate energy (including power generated from windmills, solar ponds and Ocean Thermal Energy Technology) must provide that neither the government of Guam nor the Guam Power Authority shall be obligated to purchase electrical power not needed by the Guam Power Authority.