The V.I. Public Services Commission held a special meeting Monday where commissioners expressed confusion over the V.I. Water and Power Authority’s accounting of its fuel costs, and that customers are being double-billed.

But WAPA Executive Director Lawrence Kupfer said commissioners are misunderstanding the situation, and customers have not yet been billed for the cost of a settlement with former fuel supplier, Trafigura.

The Singapore-based company sued WAPA in U.S. District Court in 2016 over $24 million in unpaid fuel bills. Attorneys eventually settled the lawsuit for the unpaid amount, plus interest, court document show.

“We could not pay Trafigura,” and that debt is carried on WAPA’s balance sheet as a liability, Kupfer said. “So, we submit that we were never paid for this fuel.”

Kupfer said that WAPA’s debts accrued “because we didn’t collect these amounts from our customers.”

“I’m very confused about your statement that you didn’t collect these funds,” said PSC Chairman David Hughes.

Hughes said the Trafigura debt was included in the Levelized Energy Adjustment Clause, or LEAC, rate, “you simply just didn’t pay the fuel vendor.”

Kupfer said that WAPA conducts a reconciliation process to determine whether there was over-collection or under-collection of funds from customers, and “we’re very confident that no, we did not collect.”

“If you fail to collect for whatever reason, that really becomes something else. It becomes an uncollectable,” said Larry Gawlik of Georgetown Consulting Group — a firm that represents the PSC. “Your failure to collect is not something that the reconciliation process is associated with.”

Kupfer insisted the funds have not been collected and “we need to be reimbursed” so WAPA can pay back Trafigura.

“I think that’s clearly a double collection,” Gawlik said. “To the extent that you didn’t collect, it becomes simply an amount not collected, and it doesn’t go back into the LEAC deferred account to be rebilled to consumers. That makes no sense.”

“Every month we go through a process where we look through the LEAC that was charged or the LEAC that was expensed, and that results in an under-collection or an over-collection,” Kupfer said. “Following that process, we have under-collected. Period, end of story.”

“That’s not the end of story,” Hughes said. “You seem to be under the impression that whatever money you spend in fuel is collectable by you. And that is not the case.”

Hughes said WAPA needs to look at other factors that contribute to costs, including whether “you blew your calculations of efficiency and generating capabilities.”

“That’s a different issue,” Kupfer said.

“I think all the fuel costs for Trafigura was collected, bottom line,” said commissioner Raymond Williams. “I am not going to support double billing.”

“That is actually the policy of the Public Services Commission, against double collection,” Hughes said.

“I don’t understand WAPA’s position on this,” Commissioner Andrew Rutnik agreed.

“We have not been collecting enough from all of our customers to pay all of our fuel bills. It’s really just that simple,” Kupfer said.

All four PSC commissioners were present at Monday’s special meeting, and voted unanimously to defer the matter until their next session pending additional discussion between PSC’s consultants and WAPA.

— Contact Suzanne Carlson at 340-714-9122 or email