Ukudu Power Plant nears finish line, promising lower power bills for ratepayers 

BY PAULY SUBA
Journal Staff

The Ukudu Combined Cycle Combustion Turbine Power Plant, in Dededo, is nearing completion and promises significant cost savings and reliability improvements for ratepayers, according to John Benavente, general manager of the Guam Power Authority. 

During a presentation at the Guam Chamber of Commerce general meeting at the Hilton Guam Resort and Spa on Wednesday, Sept. 25, Benavente outlined the island’s clean energy master plan.

"The Ukudu power plant is close to 91% completed," Benavente said, noting that the first generator is set to be energized in December of this year, months ahead of the initial September 2025 target. "If they do not meet that date, they pay $440,000 a day," he said, emphasizing the financial incentives driving timely completion. 

The plant will use ultra-low sulfur diesel and potentially natural gas, reducing fuel imports and pollution significantly. "What does that mean? At least $5 million a month you’re saving. It’s true savings for you, the ratepayers," Benavente said.

The new power plant is part of GPA's broader strategy to enhance reliability and incorporate renewable energy, with plans to retire older, more expensive units like Cabras 1 and 2 by March 2026.

Benavente emphasized the critical role of the new plant in stabilizing electricity costs, which have been volatile due to geopolitical factors and fluctuating oil prices.

“That’s your fuel oil. That’s your money going out the door,” Benavente said, highlighting the impact of rising global fuel costs on ratepayers. 
He said, “We spent almost $400 million in fuel costs. That is our biggest enemy here, because again, we have no control of that.”

The Ukudu plant is set to reduce Guam’s oil consumption by 879,000 barrels a year, part of a broader effort to cut reliance on fossil fuels and integrate renewable energy sources. Benavente said, “Our plan is by this coming February 2025, there will be a reduction in the rates just because we would have recovered all the money that we have fronted in terms of the LEAC (Levelized Energy Adjustment Clause) to help the customers.” He said that with these new measures, rates could drop to around 20 to 21 cents per kilowatt-hour, significantly lower than current levels.

Benavente noted that the plant’s completion, alongside ongoing renewable projects, could reduce Guam’s total oil use by over 50% by 2028, providing a buffer against future spikes in fuel prices. “If only using 50%, 44% of the oil we’re using today, then that makes a significant impact on what happens when oil prices go to the ceiling,” he said. Benavente said ratepayers as a whole will save at least $5 million a month once the Ukudu plant goes online. That's not considering once more renewable energy phases kick in.

According to current data from GPA, the average residential power bill is $359.52. Projections indicate that with the Ukudu plant online in 2026, that same customer could see their bill drop to $260.35. mbj