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PPUC seeks OEK approval for $2.85M escrow account to settle Solar Pacific invoices

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By Kambes Kesolei

The Palau Public Utilities Corporation (PPUC) is requesting the Olbiil Era Kelulau (OEK) to approve the appropriation of $2.85 million from the FY 2024 budget. These funds would be placed in a dedicated escrow account as mandated by the power purchase agreement (PPA) with Solar Pacific Pristine Power Inc.

PPUC Chairman Ngiratmetuchel Belechel informed Senate President Hokkon Baules in a letter dated July 31, 2024, that the state-owned utility company has started receiving invoices from Solar Pacific. He emphasized that while the budget authorizes the funds, specific appropriation is necessary to establish the escrow account, as required by the PPA upon the solar farm’s commercial operation.

“Because the language only states that it is authorized, and not appropriated, we are humbly writing to you to request appropriations of the funds because we have already begun receiving invoices from Solar Pacific Pristine Power, Inc.,” Belechel said.

Furthermore, Belechel highlighted that according to the power purchase agreement, the establishment and maintenance of the escrow account should have already occurred upon the commercial operation of the solar farm.

The PPUC’s agreement with Solar Pacific has been the subject of legislative scrutiny, with the Senate issuing subpoenas for documents related to the contract award and subsequent rate increases.