P.U.C. says B.E.L. can apply for higher rates
The B.E.L. bombshell of yet another hike in rates seems to have caught everyone by surprise… everyone except the folks at the Public Utilities Commission. According to chairman Dr. Gilly Canton, during the full tariff review process that brought new rates into effect on July first, a contingency clause, called a threshold event, was incorporated into the agreement that would allow Belize Electricity Limited to renegotiate prices if the actual cost of power exceeded the reference cost of power. As company executives maintained on our newscast Tuesday night, the rate stabilisation account has reached the six million dollar mark and with oil prices continuing to skyrocket, the utility has accrued substantial debts just to meet monthly expenses. With a formal request from B.E.L. eminent, this afternoon Canton explains how that process will work.
Dr. Gilly Canton, Chair., Public Utilities Commission
?We all know that oil prices have increased over the last couple months, have gone to as high as around seventy dollars a barrel and a lot of our energy is tied or indexed to those oil prices, the power we buy from Mexico, running the gas turbines and the diesel engines, so it has a significant effect on the total cost of power.?
?What they are going to do is come with an application and basically say, look the cost of power we had predicted, forecasted at being at twenty-one cents over the next year, it?s now at twenty-three cents because of X, Y and Z reasons, this is where the account has built up. We will then have to audit those numbers to make sure that it is indeed that fact and then probably go ahead and see how we can take that amount of money and divide it by the total amount of sales to get what an average increase would have to be for them to recover that money. We don?t want to go through the experience of having that account build up to such large numbers that it becomes a real large burden in the future again. When we had done our consultation process, before going into the proceedings, if you remember, we had gone all around the country taking about cost of power, and this was one of the feedbacks that we had gotten at that point in time, that we don?t like that account to build up to those amounts because we don?t want to be able to, later in the future for them to come back and say that we owe them that amount of money. This is a mechanism to help to ameliorate that to some effect.?
Janelle Chanona
?So message to consumers, just wait and see??
Dr. Gilly Canton
?Yeah. The message to consumers is that we live in a real world, oil prices have a lot to do with what our cost of energy is, they have stayed high, and with the Chalillo hopefully there will be some mitigating effects bringing it down and the average cost of power. Whether it offsets completely the increase in oil prices, we don?t know, but it all depends on what submission B.E.L. brings to us and we will have to look at it objectively from both the consumer?s point of view and from the licensee?s point of view.?
As Dr. Canton indicated, the reference cost of power is currently set a twenty-one cents. According to Chief Executive Officer of Belize Electricity Limited Lynn Young, officials are currently working on their formal request which should be submitted to the Public Utilities Commission by next week.
