BELIZE CITY, Mon. June 27, 2016–After an extensive review of an application filed by the Belize Electricity Limited (BEL) in January for an 11.5% rate increase, the Public Utilities Commission (PUC) has issued its final decision, declaring that the new mean electricity rate of 36.99 cents per kilowatt-hour, an increase of 5.7%, should take effect as of Friday, July 1, 2016.
The rate review applies to the Full Tariff Review period spanning 2016-2020, but the PUC will conduct annual reviews of the tariffs over the period.
Social rate customers will pay a penny more per kilowatt-hour, but commercial customers that are among the bigger consumers, as well as industrial customers, will see their service charges increase from $100 to $125. Street lighting bills, paid by the Government of Belize, will also go up from 40 cents per kilowatt-hour to 42 cents per kilowatt-hour.
Although average electricity tariffs will increase in the next few days, the PUC has not approved any adjustments to any other previously approved fees and charges. BEL had also asked the PUC to approve changes to its existing fees and charges, and to introduce new ones.
BEL had proposed total investments over the period (2016-2020) of $172.7 million. It had requested an increase in the mean electricity rate from $0.3500 per KWh to $0.3904 per KWh—an increase which would have yielded $901.5 million in revenues over the entire period. Meanwhile, the PUC’s approved rate, a marginal upward adjustment from its initial decision, should yield around $858 million in revenues over the period; $208.9 million for the year July 2016-June 2017.
Of note is that the PUC did not accept the recommendation of the independent expert, Castalia Strategic Advisors, which was contracted to review the matter after BEL objected to the PUC’s initial decision issued back in March.
In its recommendations issued in May 2016, Castilia proposed a mean electricity rate of 38.48 cents per kilowatt-hour, which would have yielded roughly $889 million in revenues for BEL.
BEL has reported profits of $24.9 million for the year 2015. Shareholders are being paid 15 cents a share, amounting to over $10 million in payouts to the majority shareholder, the Government of Belize; the Belize Social Security Board and 1,500 minority shareholders.