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BEL Seeks Hike in Electricity Prices #533745
12/12/18 05:38 AM
12/12/18 05:38 AM
Joined: Oct 1999
Posts: 65,890
oregon, spr
Marty Offline OP

Marty  Offline OP
The price of electricity may go up because on Monday, the Belize Electricity Limited (BEL) notified the Public Utilities Commission (PUC) that due to significant increases in cost of power since May 2018, the Company is proposing to increase the Mean Electricity Rate (MER) to $0.4150 per kWh for the remainder of the Annual Tariff Period January 1 to June 30, 2019. Since May, higher prices from Mexico and below average production by local hydro plants resulted in an increase in the cost of power purchased from suppliers. Nonetheless, BEL says it was able to use its strong financial position to temporarily absorb an $18.9 million dollars increase in cost of power. As per PUC regulations, BEL is required to apply to recover this increase through an adjustment to the tariff. In its submission, the Company has also notified the PUC that new negotiations are underway to secure less volatile prices from Mexico’s CFE that are typically lower than prices from local suppliers, as was the case during 2013 to 2017. Additionally, BEL will recommend to the PUC, the launch of a Request for Proposals (RFP) in Electricity Generation from competitively priced sources of renewable energy.



Light Bill Gwen Up? If BEL Has Its Way…

Your power company, BEL has asked the Public Utilities Commission to increase electricity rates.

The company notified the PUC yesterday, that there has been significant increases in the cost of power since May 2018. They are proposing that the mean electricity rates be increased from 39.3 cents per kilowatt hour to 41.5 cents per kilowatt hour from January 1st, 2019 to June 30th, 2019.

The company notes that since May higher prices from Mexico and below average production of the local hydro plans resulted in an increase in the cost of power purchased from suppliers. BEL says that it was able to use its strong financial position to temporarily absorb the 18.9 million dollar increase in costs. They note that as per PUC regulations, BEL is required to recover this increase through a rate adjustment.

The company has also notified the PUC that it is trying to secure more stable prices from Mexico's CFE.

They are also recommending that the PUC launch a Request for Power in electricity generation from competitively priced sources of renewable energy.

They believe that by the end of next year, they can achieve the objective of lowering the electricity rates.

We'll wait for the PUC's response.

PUP Blasts BEL

Earlier on we told you about BEL's request for an increase in electricity rates. Well, the PUP says it is a dose of Christmas Cheer, UDP style.

Somehow already concluding that this rate increase is already a done deal, the PUP notes, quote, "months ago, BEL had requested an increase of 7.1% in the cost per kilowatt hour, and the PUC approved a 6.24% increase which should have been in effect for 2 years. Now, just five months after, BEL is requesting another increase." End quote.

The PUP concludes, quote "To subject Belizeans to yet another increase in the cost of electricity would be unfair and can only be considered as undue hardship when the cost of living is already too high."

Channel 7

Re: BEL Seeks Hike in Electricity Prices [Re: Marty] #533997
12/28/18 04:30 AM
12/28/18 04:30 AM
Joined: Oct 1999
Posts: 65,890
oregon, spr
Marty Offline OP

Marty  Offline OP
Electricity hike due to deregulation in the peninsula area of Mexico

The cause of the increase in electricity has come as a result of deregulation in the peninsula area of Mexico. When the Electricity Giant CFE was splintered into several companies, the business model changed from a standard price to one that the market could afford. This means that electricity prices across Mexico vary and the most expensive areas are the coastal and tourism areas. Belize receives power from the Peninsula area which is the most heavily taxed markets. Ambrose Tillett, Director of Electricity, at the PUC clarified the issue further.


Re: BEL Seeks Hike in Electricity Prices [Re: Marty] #534000
12/28/18 04:42 AM
12/28/18 04:42 AM
Joined: Oct 1999
Posts: 65,890
oregon, spr
Marty Offline OP

Marty  Offline OP

Brace For A Bigger Light Bill: PUC Approves BEL Increase

2 weeks ago, we told you how BEL made a formal request for the PUC to approve an increase in electricity rates. They were asking for the rates to go up from 39.2 cents per kilowatt hour to 41.5 cents per kilowatt hour.

Opposition Leader John Briceno put the government on blast for it at the last House Meeting, and he reminded the general public that BEL got a rate increase only 6 months ago.

Well, the PUC has reviewed BEL's proposal, and the commission has done its own investigation into BEL's numbers.  And the news tonight is that it has approved the increase, and tacked on a little more.

The PUC announced that it has approved a 6.87% increase in electricity rates, allowing BEL to collect 42 cents per kilowatt hour - half a cent more than the utility had asked for.

According to the PUC, the problem is Mexico.  Almost half of the total electricity that BEL uses comes from Mexico, and right now prices in that country are trending up.

This afternoon, PUC Chairman John Avery hosted a press conference to explain that volatility in the Mexican national power grid have led to a higher cost of power in Belize:

John Avery - Chairman, PUC
"On December 10th, BEL made a submission to the PUC, asking the PUC to change the tariffs for the period January 1st, 2019 to June 30th, 2019, based on excess cost of power for the last 18 months."

"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. There are times when - during the last 18 months that Mexican power has been higher than some of our most expensive local sources, barring fossil fuel generation. And even though at times of the year it is lower than the sources in Belize, the point is that the prices that we paid are still higher than what was projected during the last rate reviews."

"Because 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."

Ambrose Tillett -  Director of Electricity, PUC
"These increases that were proving is cost that has already incurred and by law we are supposed to allow them to recover that cost."

John Avery
"The thing is that is the cost of power at the time when people were consuming the power BEL had to use its own resources to pay for it because it wasn't recovering that through the rates. So the thing is BEL in effect has been subsidizing consumers for the last 18 months. It is simply a time for consumers to repay BEL."

So, the PUC says that they want to urge BEL to seek local, alternative sources of power, so that Belize can depend less on Mexico's power grid, and therefore, buy less electricity from our neighbors to the north. 

Here's how Avery explained that it will be made clear to BEL that it must take certain steps to decrease the cost of power:

John Avery
"The PUC intends to advise BEL in writing that if measures aren't put in place in a satisfactory timeframe to mitigate some of these extra costs that we've been paying, consumers won't be expected to bear that cost. The commission intends by the 15th of January it is something that we've been working on for some time; however because of the conditions of BEL license, these type of things the commission don't normally unilaterally do. We usually do these things in consultation with BEL because they do have a say in how they operate their business. The commission is not supposed to manage BEL, however we had hoped in discussions with BEL that before the end of this year we'd have launched an auction for distributed solar generation starting first with the hospitality sector, the resorts and hotels in Belize as a request from the government that we start in that area."

"We intend to announce an auction for anywhere between 2 and 3 megawatts of solar power to be added before the end of 2019. There are still details to be worked out but we intend to invite expressions of interest and we're hoping that before the end of year we can add 2 to 2 megawatts of solar power from distributed generation starting with the hospitality sector. If they don't take up the full amount of capacity we're asking for then the invitation will be extended to commercial and residential consumers too. So we intend to do that as a first step. The other thing we intend to do at the last request for proposals we had, BAPCO had been selected to install utility grade solar in the country. That has not been executed as yet at the request of BEL, they had different consultants coming on and doing certain studies so that they know where best to add the capacity and how much to add in each location. However were not satisfied with the progress being made there and so the commission intends to become very involved in the discussions between the two parties."

And while that is what the PCC is saying to BEL, the power company's message to him is almost the same!  In its last release, BEL said it will, quote "recommend…the launch of a Request for Proposals  in Electricity Generation from competitively priced sources of renewable energy."  

Back to the PUC decision, it is the final draft from the PUC, and members of the general public have until January 5th to make written comments. The PUC must make the amendment final by January 10th, and provided that there are no substantial objections from the public, the rate increase becomes effective on January 1st, 2019.

Channel 7

Re: BEL Seeks Hike in Electricity Prices [Re: Marty] #534014
12/29/18 05:50 AM
12/29/18 05:50 AM
Joined: Oct 1999
Posts: 65,890
oregon, spr
Marty Offline OP

Marty  Offline OP

GOB Tells PUC To Wheel & Come Again on BEL Decision

Last night, we told you about the latest decision from the Public Utilities Commission to approve an increase in electricity rates. Well, tonight, the Barrow Administration is rejecting that PUC decision, and asking the PUC not to consider any increase for at least the next 6 months.

As we reported, BEL requested that the mean electricity rate be increased from 39.2 cents per kilowatt hour to 41.5 cents per kilowatt hour. The PUC went a step further. It gave them that and some "brata" when it approved an increase of 42 cents per kilowatt hour.

Well, the government sent out a rare press release today - publicly disagreeing with its own government appointed PUC. It says, quote, "… (GOB) expresses strong objections to the recent decision by the …(PUC) to approve the request from…(BEL) for an increase in electricity rate at a half cent higher than what BEL requested." End quote.

The release continues, quote, "GOB recognizes and respects the independence of the PUC, but as the largest consumer of electricity in Belize, the GOB does not take lightly any increase in rates. While the PUC has cited errors in BEL's calculations, GOB is satisfied and accepts the submission made by BEL for an increase in rate to 41.5 cents only. GOB, therefore, strongly encourages the PUC to reconsider its decision and approve the increase of 41.5 cents and not 42 cents per kilowatt hour."

The Government release ends by noting that it will certainly put an official objection in writing to the PUC to trigger a review of the PUC's decision.

And while this release quarrels with the PUC for the half a cent bonus that the regulator approved to BEL, we've seen communication from the Ministry of Energy and Public Utilities which takes it even further: it shows that the Government is pushing for a postponement of the rate increase entirely.

A letter from CEO Peter Allen to PUC Chairman John Avery says, quote, "The Ministry… is requesting that the Commission reconsider and re-evaluate the submission made by Belize Electricity Limited and the draft decision of the Commission.
...any potential losses to BEL…should be evaluated at the subsequent ARP." End quote.

So, the Government makes it clear that they want BEL to continue absorbing that cost of power for the next few months until the Annual Review Process in June. And we note that Prime Minister Dena Barrow is in charge of the Ministry if Energy and Public Utilities.

Yesterday at the PUC press conference, we brought up the rising cost of living, and the accompanying concern that citizens have about having to paying a bigger electricity bill.

The PUC Chairman said that while this rate increase puts the cost per kilowatt hour much higher than it had been recently, it is not as high as previous years:

John Avery - Chairman, PUC
"Unless we forget, this current rate is lower than what it was 10 years ago, and in fact, in the last 5 years, the country of Belize has seen some of the lowest rates in its history. So, we had a period of good, and right now, we're going through a little period of bad. But, yeah, we will take steps to improve it."

We've since gone back into our archives, and we've confirmed what the Chairman said.

This graph illustrates that in January 2013, the electricity rate was at 49 cents per kilowatt hour. 1 year later, it decreased by 2 cents, and then by January 2015, it had dropped by an additional 2 cents to 41 cents per kilowatt hour.

6 months later, the mean electricity rate went down to 35 cents per kilowatt hour, its lowest in recent history.

By June 2016, BEL began requesting increases, and the PUC approved one such request, bringing the electricity rate up to 36.9 cents. Things remained stable for a little over a year and a half, despite multiple requests from BEL for an increase. By June of this year, the rate went up to 39.2 cents per kilowatt hour, and now, there is this controversial decision from the PUC to increase it to 42 cents per kilowatt hour, only 6 months later.

Of course, this is in addition to the GST that the Government tacked on to the electricity bill. Back in April of last year, the Government changed the tax regime on electricity so that if your bill is over $100 monthly, you have to pay 12.5% tax on it. With this latest proposed rate increase, customers teetering near that $100 threshold will now be hit with that additional GST. We asked the PUC Chairman about that yesterday:

John Avery - Chairman, PUC
"The best advice we could give to consumers, particularly those who may be right on the edge is to try to conserve as much power as possible. I mean conservation is always an avenue open to consumers. In fact, it is advisable. There is no sense in paying for power that you don't need. So, those customers, the best advise you can give them, is to try to conserve as much power as possible and keep your bills low. That would actually help the situation, particularly during the day when Mexican prices might be highest. If people would consume less power, then that's less high-end cost power that BEL has to purchase. So, energy efficiency is always advisable. It is perhaps the easiest way to deal with your bills, as opposed to trying to get a cheaper source."

We'll keep following the story to see how this dispute plays out.

Channel 7

Re: BEL Seeks Hike in Electricity Prices [Re: Marty] #534268
01/11/19 06:14 AM
01/11/19 06:14 AM
Joined: Oct 1999
Posts: 65,890
oregon, spr
Marty Offline OP

Marty  Offline OP

PUC Says No Review, No Electricity Rate In Effect

Today was the deadline for the Public Utilities Commission to make a final decision about whether or not to increase electricity rates. You'll remember that the Government and a few UDP supporters objected to the decision from the PUC to increase electricity rates from 39.2 cents per kilowatt hour to 42 cents per kilowatt hour. The Utilities regulator has considered their objections, but in the end, the PUC is deciding that this rate increase still has to happen.

But, they've decided to give you, the consumers, a small relief. Instead of increasing your light bill by 6.9% to 42 cents per kilowatt hour, they're only increasing it by 5.5%. That means that the rates are going up to 41.38 cents per kilowatt hour instead, which is less than the 41.5 cents per kilowatt hour that BEL was requesting, and certainly lower than the 42 cents per kilowatt hour that the PUC decided on 2 weeks ago.

A press release from the PUC says, quote, "The Amendment provides for an increase in the Mean Elecricity Rates to 41.38 cent per kilo-watthour, along with relevant increases to the approved Tariffs to be applied during the period January 1 to June 30, 2019."

So, what about the formal objections from the Government and the UDP supporters who wrote to the PUC? Well, we are told that those objections, though they were only a handful from the total number of electricity consumers, were taken into consideration and played a role in the reduction of the increase that the PUC had initially approved.

Channel 7

Re: BEL Seeks Hike in Electricity Prices [Re: Marty] #534295
01/12/19 06:09 AM
01/12/19 06:09 AM
Joined: Oct 1999
Posts: 65,890
oregon, spr
Marty Offline OP

Marty  Offline OP

After Rate Hike, BEL Promises To Bring Them Back Down By 2020

You may be frowning because your light bill will be going up at the end of this month - but BEL says that it hopes to bring rates back down to 37 cents per kilowatt hour by 2020 - which, we'll note, sounds like great political timing. And BEL hopes to do this by accessing cheaper power - whether it be from Mexico, renewable energy plants, or a new dam.

But, while that is the commitment going forward, for right now it seems the PUC was pretty much powerless to deny BEL a rate increase - which you'll see on your bill at the end of this month.

And that's because the increase is to recover 18.9 million dollars BEL has already spent absorbing a steep hike in the cost of power. The law says that cost has to be passed through to consumers.

And that's why the PUC took a surprising decision to ignore a government request to hold off on consideration of any increase in rates until June of this year. The PUC instead decided to go ahead with an increase effective immediately. But what the Commission did is make that increase a little less: instead of the 41.5 cents per kilowatt hour proposed a month ago, the new average rate will 41.38 cents per hour - which hardly noticeable to the average consumer.

But, tonight, there's some insight into the negotiation between the PUC and BEL to hammer out that modest adjustment.

A release from BEL says both sides met on Monday where BEL again put forth its case that it has been using its cash flow to absorb that increase in the cost of power.

And, the release says, quote, "After taking BEL's explanation into consideration, the PUC has decided to increase the Mean Electricity Rate to (41.38 cents) per (kilowatt hour)"

But, while BEL gets to recover its 18.9 million, the release adds that the PUC will be keeping an eye on things to make sure the utility is doing all it can to produce power as cheaply as possible. And that includes securing better prices from Mexico, and, quote, "resist(ing) recent attempts by local Independent Power Producers to increase cost." Those efforts are expected to bring average rates back down to 37 cents per kilowatt hour. There's also talk of adding cheap renewable energy plants such as solar and wind by 2022, and an additional hydro plant by 2023.

Channel 7

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