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Home Headline PUC approves BEL’s request for increased electricity rates

PUC approves BEL’s request for increased electricity rates

GoB condemns PUC’s decision; PUP condemns GoB

BELIZE CITY, Mon. Dec. 31, 2018– Two weeks ago, in the December 14 edition of the Amandala, we reported that Belize Electricity Limited (BEL) had requested from the Public Utilities Commission (PUC) an increase in electricity rates from $0.3862 per kilowatt hour to $0.4150 per kilowatt hour.

On December 27, the PUC held a press conference at which they said that they had approved BEL’s request, but not for the initial $0.4150. Rather, the PUC has approved a 6.87% increase, which would take electricity rates to about $0.42 per kilowatt hour.

PUC’s chairman, John Avery, explained why the PUC approved the increases, attributing it to Mexico’s own electricity rate increase. “We came up with a rate of about 42 cents, which is, of course, half cent higher than BEL requested. However, as I pointed out, there were some errors in BEL’s submissions. This excess cost of power basically can mostly be attributed to higher prices from Mexico,” Avery said.

Avery continued, “We buy power from the peninsula area of Mexico; that area has seen increases 4 or 5 times as high as the other areas in Mexico. It’s not really related to the cost of power itself, but more the deficiencies in their transmission system, and so, there are penalties for the transferred loss of huge amounts of power in the transmission system for the peninsula area of Mexico. Unfortunately, that is the area we’re connected to and so those increase in costs – we also see them.”

Avery also said that for about 18 months, BEL was using its own resources to pay for the increases, since it wasn’t recovering it through electricity rates, and it is required to get that money back. Hence, as Avery said, “it is simply a time for consumers to repay BEL.”

The PUC will also advise BEL to put measures in place, within a satisfactory timeframe, to mitigate the extra costs that Belizeans have been paying, because after that period of time has passed, consumers won’t be expected to keep bearing the cost.

The day after the press conference, on December 28, the Government of Belize (GoB) issued a press release in which they  expressed “strong objections to the recent decision by the Public Utilities Commission (PUC) to approve the request from the Belize Electricity Limited (BEL) for an increase in electricity rate at a half cent higher than what BEL requested.”

The release said that although GoB recognizes the PUC as an independent organization, the government is in fact the largest consumer of electricity in Belize, and they do not “take lightly” the increase in the rates. GoB said that they are satisfied with the initial request from BEL to increase the rates by 41.5 cents and strongly advise the PUC to reconsider the approval of 42 cents.

As with any increase in rates, members of the general public are given a time period within which they can formally object to the increase, and the PUC may opt to review their draft decision. The public has up until January 5, 2019, to do so, and the release from GoB confirms that that is their official objection.

The release ends by saying that GoB anticipates a positive review and final decision from the PUC.

Later, UDP chairman Alberto August also wrote to Avery, requesting the PUC to “urgently reconsider its initial decision with a view of leaving electricity rates unchanged.” August said the “matter can subsequently be revisited for the next Tariff Review Period when, hopefully, with decreasing fuel prices, there will be no need for higher electricity and customers could instead be treated to a reduction in rates.”

Even Alfonso Noble, editor of the Guardian newspaper, wrote to Avery – who was once also the editor of the newspaper — about his objection to the rate increase, and detailing how it will affect his household.

The PUP also issued its own press release, but instead of objecting to the rate increase, it condemned GoB. The release, which is titled “Barrow’s Smoke and Mirrors Circus Act,” begins by referring to Prime Minister Dean Barrow as being an “absentee” in 2018, saying that he “perfected his disappearing act in what has been a UDP governance circus.”

The PUP said that they “reject with extreme prejudice, the duplicitous and ludicrous game being played by the Government of Belize (GOB), BEL and the PUC.” They then explained that the PUC decided that the increase BEL asked for was too little, and therefore “gifted” them with a higher rate increase. Then GoB stepped in and asked the PUC to revisit its “gift” to BEL, and then GoB further asked that rates not increase at all for the next six months.

The PUP’s release said that the Prime Minister controls both BEL and the PUC as head of the government, and that the boards of both these entities “serve at the whim of the Prime Minister.” They then claimed that it is widely known in political and government circles that John Avery “never makes a move without first getting the nod from the Prime Minister.”

The PUP then asserted that they are not doubtful that PM Barrow was apprised of BEL’s application for a raise before it even happened, and he also knew beforehand that the PUC would approve half a cent more than what BEL requested.

“The reason for this bizarre game of misdirection is simply that Mr. Barrow is fully aware that Belizeans are fed up of the increased cost of living. In just the past year he added GST to electricity bills of $100 and above. Then there was an increase in electricity rates. And now another increase!” the release said.

The PUP also claimed that PM Barrow is trying, “in very lame fashion, to pass GOB off as the hero in this charade, with the PUC being the villain.”

The PUP said in their release that they wanted to remind Belizeans that the Barrow administration was also playing “the role of hero” back in 2011 when they nationalized BEL, purportedly for the benefit of Belizeans. “Mr. Barrow himself pontificated at length, proclaiming that there would be no raise in electricity rates under his government’s watch. Those days are apparently long gone,” the release said.

The release ended with the PUP calling on PM Barrow to “abandon his stupidity immediately.” They said that instead of “waving a wand on the circus stage,” the PM could use his time more effectively to try and fix the “rupture in governance caused by excessive spending, mismanagement and rampant corruption.”

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