BELIZE CITY, Thurs. Dec. 13, 2018– About 6 months ago, Belize Electricity Limited (BEL) had attempted to increase electricity rates by 7.1%, from $0.3699 per kilowatt hour to $0.3954. Instead, in May, the Public Utilities Commission (PUC) only approved an increase of 4.4%, which set the mean electricity rate at $0.3862 per kilowatt hour.
This had been approved from the period of July 1, 2018 to June 30, 2020. On Tuesday, December 11, however, BEL issued a press release in which they announced that the day before, December 10, they notified the PUC that they are proposing to increase the electricity rates again, this time to $0.4150 per kilowatt hour.
According to BEL, this increase is “due to significant increases in cost of power since May 2018.” BEL said that higher prices from Mexico and below average production by local hydro plants had resulted in an increase in the cost of power purchased from suppliers. BEL said, though, that thanks to their “strong financial position,” they were able to temporarily absorb the increased cost of power, which amounted to $18.9 million.
BEL, according to PUC regulations, is required to apply to recover this increased cost through an adjustment to the tariff, the release said.
The release also said that in their submission, they notified the PUC that “new negotiations are underway to secure less volatile prices from Mexico’s CFE that are typically lower than prices from local suppliers, as was the case during 2013 to 2017.”
BEL will also recommend to the PUC the launch of a Request for Proposals (RFP) in Electricity Generation from competitively priced sources of renewable energy. The release said that BEL is confident that it will be able to achieve its objective of lower electricity rates by 2019.
The People’s United Party (PUP) responded to the government-owned BEL release with its own release on December 11, in which it condemned the rise in electricity rates. The PUP release said that it is “a shameful act of duplicity on the part of both the Government of Belize and BEL.”
The PUP release noted the previous spike in prices, and claimed that “Belizeans have been forced to pay more in electricity bills in the past year, not only because of the increase in the cost per kilowatt hour, but because in 2018, GOB lowered the tax-threshold on electricity bills.”
The PUP release called the proposed rise in prices “unfair” to Belizeans, considering that the cost of living is already too high. The PUP also suggested that the reason for the increase in rates was to recover the money spent on the “Christmas Cheer,” which consists of a $25,000 allotment for each UDP area representative to spend on Christmas giveaways and treats in his constituency.
The PUP area representatives, on the other hand, were offered $12,500 each.
The release ended with the PUP calling on GoB to “explore cost-cutting measures both in its own operations and in outlandish expenditures before trying to tax Belizeans once again.”