ST. THOMAS, VI—The Committee on Government Operations, Veterans Affairs, and Consumer Protection, chaired by Senator Avery L. Lewis, met in the Earle B. Ottley Legislative Hall. Lawmakers received updates from the Virgin Islands Water and Power Authority, the Public Services Commission, and the Department of Tourism.  

Karl Knight, CEO and Executive Director of the Virgin Islands Water and Power Authority, stated that the Authority remains in a fiscally challenged position. The only steady source of operating revenue it collects is the monthly charges for the sale of electricity and water to customers. Currently, WAPA spends more to provide service than it collects in charges to its customers. WAPA operates presently at a monthly deficit of $2-3 Million. Knight states that despite the increase in fuel costs, the Authority has not substantially increased its rates in nearly six years. The current residential rate is $0.434 per kilowatt-hour. Knight stated that closing the deficit solely through rate increases would require a rate increase of approximately 8 cents or more, which would exceed 50 cents per kilowatt-hour. Additionally, Knight stated that the Authority has roughly $101.7 million in past-due accounts payable and $188 million in long-term debt. The Ernst & Young turnaround management team has said that the Authority would need a cash infusion of approximately $375 million to resolve its financial difficulties. These financial challenges could potentially lead to service disruptions or increased rates for the residents of the Virgin Islands, which would significantly impact their daily lives and household budgets, says Senator Lewis. 

The average peak daily load in the St. Thomas-St. John District is approximately 60 Megawatts. The minimum demand is approximately 33 megawatts—the primary source of power generation in the St. Thomas-St. The John District is located near the Randolph Harley Power Plant in Krum Bay. There is no power generation in St. John. However, there are projects to bring resiliency to St. John. The average daily peak load on St. Croix is approximately 43 megawatts. The average daily base load is approximately 28 megawatts. The primary source of power generation on St. Croix is the Richmond Powerplant in Christiansted. FEMA has approved funding for the complete replacement of the Richmond Power Plant, which includes at least 86 Megawatts of generating capacity.  

Knight mentioned the numerous customer service challenges the Authority has been facing, which include malfunctioning meters. WAPA has selected Itron as the contractor to rebuild the Automated Metering Infrastructure. FEMA is funding this as a part of the Disaster Recovery Prudent Replacement Program. It is expected to take 18 months to complete in the territory. The Authority also replaced 1,000 electrical meters in December. An additional 2,500 meters are being installed for new services and the replacement of malfunctioning meters, as well as an additional 2,500 meters that have been procured.  The Authority has also continued to strengthen its electrical transmission and distribution system through the installation of composite poles. Phase I for St. Thomas, St. Croix, and Water Island are 100% complete, marking significant progress. St. John Phase I is 87% complete. Over 9,196 wooden poles have been replaced with composite poles. Phase II will see the installation of an additional 1,350 poles, further enhancing the system’s resilience and reliability.   

In higher-populated areas, the Authority has begun burying electrical lines. This includes feeder 5A in St. Thomas, Queen Mary Highway Phase 1, and Hannah’s Rest on St. Croix.  The Authority also plans to upgrade the East End Substation, the Donald Francois Substation, and the Tutu substations on St. Thomas. This includes HUD funding for battery energy storage systems at all facilities. This is also planned for the Gregory Willocks substation on St. Croix.  Water system improvements are planned. Upgrades are underway in Hannah’s rest and Campo Rico on St. Croix, as well as proposals for replacements at Blackbeard’s Hill and Mahogany Estate. A Request for Proposals is being prepared for the waterline rehabilitation in Norre Gade, Sara Hill, and Hospital Ground. Knight also stated that the most pressing issues included underfunded street lighting expenses and back billing.  

Sandra Setorie, Executive Director of the Virgin Islands Public Services Commission, delivered an update on telecommunication, waste, PSC assessment disputes, and energy matters. The commission is responsible for conducting rate investigations of each regulated utility every five years. The Commission’s jurisdiction over rates is limited to traditional landline telephone.  Twenty years ago, VITELCO (currently operating as VIYA) had just over 100,000 telephone lines and received about $14 million in federal support. It now has fewer than 20,000 lines, and federal support has been drastically reduced with plans to phase it out soon. Cellphones now directly compete with landlines.  A rate review of the ferries began in 2024. Setorie stated that she hoped that the newly completed Ferry, Spirit of 1733, owned by the Department of Public Works, would be leased to one of the joint franchises, which would be key in the investigation of rates.  Furthermore, separate investigations will be conducted to review energy and water rates. Electric system rates, last reviewed in 2020, will be reviewed again in April 2025.  A formal investigation into water rates is expected to begin in the Summer of 2025. The water system, which has been under scrutiny due to water quality issues in St. Croix in 2024, is set to undergo a substantial upgrade. The line losses in the St. Thomas-St. The John District has been relatively low; however, it has begun to increase. Delivery pipelines in St. Croix have been a major contributor to water quality. “The approval of federal funds to replace the St. Croix Water System is a hopeful sign for the future of water quality in the area,” says Lewis. 

Two separate investigations will be performed for Waste Management. Operations related to solid waste disposal are separate from those related to wastewater systems. Before the passage of Act 8471, the commission was limited to approving the fees of the Waste Management Authority without broader oversight. The Commission has been seeking information on the total costs, charges, and activities of the Waste Management Authority. The Wastewater system is expected to undergo a rate investigation, which is scheduled to begin in Summer 2025. A solid waste investigation will also be considered, which is likely to focus on landfills, recycling, and the late payment of vendors, if at all, as well as the fact that the Waste Management Authority remains dependent on the legislature for funding. The Commission also intended to initiate oversight activities for the Waste Management Authority; however, it failed to meet its financial obligations to the PSC, rendering this impossible. Until this year, the PSC had never been funded by direct general appropriation of general fund resources. It is supported by assessments of the utilities it regulates.  

Chair Lewis inquired about the four recently installed Wartsila units, which had failed shortly after commission. CEO Knight that they had been repaired, clarifying that two are operating, and a third will be returned to service.  

Alani Henneman, Assistant Commissioner of the Virgin Islands Department of Tourism, delivered testimony.  Henneman stated that there was a 27% surge in arrivals to St. Thomas during Carnival, as well as a steady increase during the Crucian Christmas Festival. Additionally, there has been interdepartmental cooperation with various departments, including the Police Department, Sports Parks and Recreation, VITEMA, VIFEMS, Public Works, Waste Management Authority, Port Authority, and Licensing and Consumer Affairs. These agencies have assisted with event logistics, community health and safety, and preservation of event locations for all Division of Festivals official events. The Water and Power Authority has also met with the Department to coordinate the installation of utilities in the Carnival Village. Additionally, the Department secured two local vendors to ensure adequate bathroom facilities, including 11 ADA-compliant stalls near the Carnival Village, seven stalls at the Food Fair Venue in Crown Bay, and 15 portable toilets along the J’ouvert and Parade Routes. The Department of Tourism also plans to showcase the territory in various ways, such as the Seatrade Global, on-site sports partnerships, including the Boston Red Sox, Chicago Cubs, New York Jets, and the New York Mets, the Caribbean Hotel and Tourism Association Marketplace, and the Caribbean Tourism Organization – Caribbean Week. According to Ian Turnbull, Director of Festivals, St. Thomas Carnival’s budget is $2.8 Million, with the average person spending approximately $2,000 to $5,000 while on the island for Carnival, resulting in roughly $6 million to $10 million in revenue. Senator Lewis stressed the importance of Tourism and Public Works officials informing the public about road work schedules and suspending roadwork to intensify driver safety ads as the festival nears. Moreover, committee members encouraged the variety of niches in global tourism and explored the possibility of introducing our market to these niches.  

Senators present at today’s Committee hearing were Avery L. Lewis, Novelle E. Francis, Jr., Ray Fonseca, Alma Francis Heyliger, Kenneth L. Gittens, Franklin D. Johnson, and Carla J. Joseph. Non-committee members present were Angel L. Bolques, Jr., Hubert Frederick, Clifford Joseph, Sr., Milton E. Potter, and Kurt A. Vialet. 

The Division of Public Affairs is committed to providing the community with accurate information on legislative proceedings and other events at the Legislature of the Virgin Islands. Visit legvi.org. 

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