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Jun 15, 2011

Government lays out case for B.E.L. buyout

Prime Minister Dean Barrow has taken to the airwaves since he announced last Friday that government is considering acquiring majority shares in Belize Electricity Limited. This morning an official four page statement was circulated by his office laying out the government’s case and crafted to ease any fear among investors. With the withdrawal of BEL’s CEO, Lynn Young as intermediary, Attorney Eamon Courtenay has been appointed to represent Fortis. The latest, as we understand it, is that no formal offer has been made to Fortis by government. Still yet, government says it will not consider a thirty-six million dollar rebate that the Public Utilities Commission, made in its rate review of B.E.L. in 2008. That’s the main hurdle for government, so as it stands right now, there are no negotiations taking place with Fortis. Government is also asking for full details of B.E.L.’s finances. In today’s release, government declared that no further credits, guarantees or financial assistance will be provided to BEL after the final prepayment. Government also reiterates that it is prepared to acquire the company since that is the only way that an uninterrupted power supply can be guaranteed.

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8 Responses for “Government lays out case for B.E.L. buyout”

  1. Susan Brown says:

    The Government must accept that the cost of energy has risen world wide and is still rising and that consumers must be prepared to pay for the energy they consume. The energy providers are not charitable concerns and need to be re-imbursed to cover their operating and supply costs and to provide a comensurate reward to investors.
    This is a fact of life whether the energy provision is run by private companies or by civil servants.

  2. Lindsay Howard says:

    Cost of energy HAS risen world-wide. But, what has happened here has nothing to do with the rising cost of energy. It has to do with a captive monopoly that refuses to seriously invest in alternative energy sources, and is itself held captive by BECOL, the arm of Fortis that takes BEL’s earnings out of the country and directly into the Fortis coffers, without regulation by the Belize government. BEL also didn’t cut rates, as it is supposed to do, when energy costs go down. Fortis, BEL and BECOL can’t have its cake and eat it, too.

  3. Elgin Martinez says:

    Maybe they should cut BEL employees pay to cover the cost of some of their expenses.

  4. Maverick says:

    By all indications, the finances of BEL should not be in a loss situation. Why is it that the court ruled in favor of the PUC in their indication that the declared cost of power calculation was inaccurate, and that the 36M that was actually collected should be included in their profit numbers? The auditors that signed off on those statements, ignoring historical performance data, should be ashamed of themselves. Using proper accounting; not creative accounting, the PUC has proven that BEL’s real earnings are in the neighbourhood of 25m per year. Granted this profit is not evenly spread out in a neat cash flow model due to seasonal fluctuations in the source and cost of power, but any prudent business would manage its cash flow to ensure that sufficient cash is available from the profitable months to cover the loss months.

    The excuse that borrowing has been frozen is a ludicrous one; the only reason a bank would refuse to lend is if the company is seen as being irresponsible in its cash flow management. Fortis needs to stop blaming the regulators and take responsibility for their own mis-management.

  5. Elgin Martinez says:

    This is all a game by Mr Barrow and Lynn Young to raise the price of Electricity on the Belizean people hence the reason Mr Barrow is out in the media talking about an imminent blackout.They are hoping that the Belizean people will get scared and agree to an increase in Electricity bills.

  6. RedBwai says:

    @ Elgin ur quite the conspiracy theorist lol…i like….but you raised a valid point at dat…the way things are in Belize nowadays…u have to think the worst of the worst because you would be surprised to know whats really taking place behind closed doors…everyone knows everyone and once you have friends in high places ur good. As far as i know BEL owes me as well as all other customers money which the PUC ordered should be returned to us…but thats not gonna happen if my hunch is right…

  7. rod says:

    another part of this corrupt gov. when will it end ill tell you when this pm resigns or is kicked out of office for being the worse pm and gov. in belizean history there isnt a facet of gov. that is going right not one part please resign barrow for the good of belize and its people admit your failure and resign.

  8. SASHA says:

    Gov’t should take back BEL & lower or keep the rates as is. This gov’t gets electricity from Mexico, where it is cheap & does not cost alot for transportation. PM help the Belizean people and forget privitization & big profits for them. Keep your money in Belize.

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