On the face of it, it sounds like news worth celebrating to hear that the Belize Electricity Limited (BEL) actually wants electricity rates to be reduced by 6%, but come to think of it, 6% isn’t much, especially after you recall that the Public Utilities Commission (PUC) more than a month ago had approved new tariffs that would have resulted in a 15% reduction in electricity rates, and a $10 shave off the monthly services charge to commercial customers.
But customers have not been able to see their light bills go down because that very PUC decision is locked in the Supreme Court. BEL has been opposing that decision, as well as PUC’s rate decision dating back to last June.
Even though no one knows for sure how that legal battle will end, the PUC did score a victory in the Supreme Court, which ruled that the Minister of Public Utilities, Melvin Hulse, did not act improperly when he struck down a Statutory Instrument that reinstated regulations dating back to 2005. But as with most legal battles these days, there are appeals that drag things out indefinitely.
Nevertheless, those rate regulations, says Leroy Almendarez, the PUC’s director of Administration and Rate Setting, call for BEL to submit an application for a Full Tariff Review Period (FTRP) – spanning the next four years. It appears to the PUC, however, that BEL is being obstinate and doing its own thing, going by regulations that Minister Hulse had struck down back in early 2008.
Today, the company announced that it has applied to the PUC for an average 6% rate reduction for annual review proceedings for July 1, 2009, to June 30, 2010.
Almendarez told our newspaper this evening that the PUC will advise BEL that it is not accepting that application, because that’s not what it is supposed to submit and the application is “invalid”.
In a late evening press release, the PUC says that rate setting proceedings are in conformity with the Electricity (Tariffs, Charges and Quality of Service Standards) Byelaws, 2005, S.I. No. 145 of 2005, and under those regulations, BEL should have made a submission for a Full Tariff Review (FTR) in January, 2009, which it has so far refused to do.
“In conformity with the governing legislation, the PUC cannot accept any other submission from BEL at this time, but a submission for a Full Tariff Review Proceeding,” the PUC concludes.
The Commission arrived at that stance after acting chairman, Net Vasquez, met with Victor Lewis, PUC’s Director of Electricity, and Almendarez.
Given that BEL was supposed to file that application since January and has not yet done so, we asked Almendarez whether the PUC is not simply just sitting back and letting BEL have its own way.
To this he replied, “We are not sitting back and letting BEL have its way. Not because BEL has taken us to court means we are not enforcing the laws. Yes, we are,” said Almandarez.
He told us that the PUC had decided to give BEL an extension to file its FTRP application, from January 31 to April 2, and when that date came today, what the PUC got instead was a much smaller application for one year’s rates.
Almandarez says that the PUC’s next course of action is to tell BEL that it won’t accept its application because it is invalid.
“They want to go outside legislation,” he added.
Almendarez said that PUC chairman, John Avery, has written BEL on numerous occasions asking BEL to submit its application for a 4-year tariff review, not a one-year review as it did today.
He told us that BEL wants the PUC to reverse corrections the Commission made last year, amounting to $36.1 million, which the PUC will not do.
(We note that reversing those corrections has the effect of nullifying much of the benefit that should accrue to consumers because of falling world oil prices.)
A review of BEL’s proposed rate schedule reveals that in all cases except for social rate customers, the rates BEL proposes are substantially lower than what the PUC had approved back in February, to have taken effect retroactive to January 1, 2009.
The PUC estimates that BEL owes customers roughly $20 million in rebates.
(Ed. NOTE: Anansi, in Creole folklore, is a lazy, tricky spider who always manages to outwit his fellow creatures, to his own advantage.)