Electricity monopoly reports $10.8 million in losses…

The delayed A.G.M. of Belize Electricity Limited took place today and as its top executives had previously warned, the hard times have hit home for the local utility company. At it’s A.G.M. today B.E.L. reported to its membership a loss of ten point eight million dollars. And no surprise, the company lays blame directly on the regulatory body, the Public Utilities Commission. Following the meeting News Five spoke with B.E.L.’s C.E.O., Lynn Young, who said if the P.U.C. had not imposed a thirty-six point two million dollar charge following the 2008 Annual Tariff Review Proceeding, the company would not be in such dire straits. To add to that, Young says B.E.L. will have to take some cost-cutting measures and quite possibly apply for a rate increase.

Lynn Young, C.E.O., B.E.L.
“This is the first time in my twenty something years working with B.E.L. that the sales have actually declined. That’s an indication of what’s happening in our economy so we know that on a go-forward basis, there’s going to be some significant changes. Will we have an increase in the rates? At this current level in our crisis we think that we can weather it out and we proposed to the P.U.C. that we can do a small rate reduction earlier when oil prices were around thirty-eight dollars a barrel. We were thinking that we could do a small reduction and spread out the recovery of that thirty-six million dollars over a three or four year period so that it doesn’t impact customers. With the oil prices going up, that window of opportunity seems to be closing in on us but we are very hopeful that when we bring BELCOGEN online—which BELCOGEN is burning bagass so it is less dependent on oil prices. When VACA is finished, that’s going to be hydro so it’s gonna be less dependent on oil prices and we’ll be able to hold the fort. Again, if oil prices go back to the levels it was last year, we will have no choice but to ask for a rate increase. But all indications are that it shouldn’t go back to the levels that they were last year.”

Marion Ali
“At the end of the day, the consumer doesn’t want to hear that. That’s bad news for them; asking for a rate increase.”

Lynn Young
“Yeah, the consumer doesn’t want to hear that, we don’t want to hear that; nobody wants to hear that. But sometimes we have to—if, IF oil prices take off again us, the cab drivers, the airplanes, B.W.S.L. is already asking for a rate increase, which is based mostly on what happened last year. So we—that’s why I’m saying that it’s not just B.E.L. We need to invest about thirty to thirty-two million Belize dollars in putting in back-up transmission routes so that when we have a problem with the transmission maybe in Mexico, we can reboot the power through a different route and keep the power on. But we cannot do that unless we can borrow money and we cannot borrow money while we are in default.”

Another group that will not be happy are the shareholders who do not stand to benefit from any dividends.