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Jun 27, 2007

New electricity rates will help low end consumers

Story PictureThe Public Utilities Commission has delivered its final decision on electricity rates. The result is that beginning July first, lower volume consumers will see their bills drop while larger users, including commercial and industrial customers, will pay more. A key feature of the new set of tariffs is that the ten dollar monthly service charge for residential users is eliminated in favour of increased charges per kilowatt hour. Even though the new rate jumps from twenty-nine to thirty-five cents for the first fifty kilowatt hours, the elimination of the service charge means that the monthly bill for a fifty kilowatt hour household will drop seven dollars from twenty-four dollars and fifty cents to seventeen-fifty. The savings diminish as you use more electricity, with the break even point around four hundred and fifty kilowatt hours per month. This means that if you currently pay less than two hundred dollars per month your bill will go down; more than two hundred it will go up … but not by much. According to Belize Electricity Limited, its total revenues will be unaffected by the new rates. But the rebalancing will result in a lowering of bills for around seventy-five percent of residential customers. Commercial customers will pay slightly higher rates, while the charge to government–that means taxpayers–for street lighting will go up by three cents from fifty-two to fifty-five cents per kilowatt hour. Although the company got most of what it had originally requested, a release from B.E.L. complains that the P.U.C. denied its bid for increased disconnection and reconnection fees as well as the introduction of charges for liquidated damages in the event of tampering by consumers.

At a press conference today the P.U.C. stood by its decision on metre tampering and said that while it will be dialoguing with B.E.L. on the connection issue, any possible change would not come until a year from now. In response to the question of whose side the P.U.C. was on, Chairman Roberto Young indicated that an answer is not that simple.”

Roberto Young, Chairman, Public Utilities Commission
“We are a balancing act, however by our Public Utilities Act we need to take the interest of the consumer into account. But, yes we need to listen to the utility, we need to keep them viable, we need to listen to government, we need to listen to the people, we need to listen to the public outcry there so, yes we do take everybody’s consideration there and try to come with as optimal solution as possible.”

Young said that B.E.L.’s rate of return on investment was running in the neighbourhood of twelve percent, well within the regulatory guidelines which range from ten to fifteen.

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