PUC Talks Mean Electricity Rate Increase

Brace up because beginning on Sunday, your light bill is going up for the next two years. This follows a decision taken on Tuesday by the Public Utilities Commission as applied for by Belize Electricity Limited. The electricity company made a submission was made on April first, the beginning of the 2018 fiscal calendar. B.E.L., in its request for an Annual Review Proceeding, suggested an increase in the average cost of electricity, from roughly thirty-seven cents per kilowatt hour to thirty-nine point five cents and approximately thirty-nine cents per kilowatt hour over the next two Annual Tariff Periods.  In its final decision, the P.U.C., approved an increase in Mean Electricity Rate of thirty-nine point three cents per kilowatt hour, to carry through from July first 2018 to June thirtieth, 2020.  P.U.C. Chairman John Avery fielded questions from the media.

Reporter

“Are you as a reasonable individual satisfied that the electricity provider is getting a reasonable rate of return and that the customers aren’t being gouged?”

John Avery, Chairman, Public Utilities Commission

John Avery

“Well that really is the role of the PUC.  When we set, for example, [Operational Expenses] we set a target.  If BEL spends more than that it’s their loss.  If they spend less they’re increasing or improving their efficiency, it goes to their bottom line.  As a subsequent review proceeding then that benefit would eventually be shared with customers.  The methodology we use tries to provide the incentives for the company to perform a certain way.  As I mentioned at our last press conference, because of the need to have expanded to provide access to the rural areas and that sort of thing, the rate setting methodology emphasizes investments and so the biggest reward for BEL is to make the investments in order to expand its system.  However, what has been happening recently is because of all the climate change concerns and that sort of thing, there’s a big push around globally and particularly in the Caribbean because we would be very vulnerable to strengthen our systems.  So you will find that places like BEL would have increased their construction standards and that does in fact increase cost.  But there are benefits to it if we start to get stronger storms and that sort of thing then we’ll have a more robust system that will stand up to such storms and we can get back services more quickly.  However, as I had mentioned there, these things they provide some tangible benefit provided that things turn out the way we’re forecasting they will, they don’t necessarily increase sales and so things like that actually end up increasing the cost of energy or of electricity to customers and so we have to find a way to strike a proper balance between the two.”