The BEL Board Chairman explains the Cost of Power continues to rise, another side-effect of the war in Ukraine, which is driving up world energy prices.
The Public Utilities Commission has made a decision to keep your electricity rates low going into next year, but in order to achieve that, BEL's shareholders are absorbing the additional cost of power. The company has already made the point that this current state of affairs is unsustainable in the long term and today, Chairman Marshalleck reiterated that. He stressed that urgent actions need to take place if your electricity rates will remain stable:
E. Andrew Marshalleck, SC - Chairman, BEL Board of Directors
"Well, the cost of power has been steadily increasing, and with the war in Ukraine and the shocks on supply. Energy prices have increased globally. Notwithstanding, we've been able to maintain it relatively low at 39 to $0.40 a kilowatt-hour. That rate is on par with what is charged in New York, for instance. It's less than what it's charged in California, which is about $0.53 a kilowatt-hour, far less than what's being charged in the UK, which is $0.76 per kilowatt-hour, and in Germany, $ 0.54-kilowatt-hour, just to give you a sense where we are. We're at 39 to 40 cents, so we've been able to do fairly well in terms of pricing and to keep it relatively low in an environment where the pressures for price increases are significant."
"Is it not sustainable, though?"
E. Andrew Marshalleck, SC
"Well, that's not the thing. It's - we can do that for a time, but that's not sustainable indefinitely into the future if things remain the way they are. And in order to change that and maintain price stability, what we see as necessary are significant investments in in-country solar generation, as a matter of urgency to help stabilize those costs. We also need to see some improvements to the transmission system with the inclusion of batteries which allow us to store power gained from solar in the day and use it at night, or alternatively to buy from CFE when prices are low and to use that energy during peak periods and the margins we can get off those things we think will be enough to stabilize the cost of power going into the future. The trouble we've experienced with that is, is getting those projects executed and on the ground because there isn't a very good track record of actually realizing generation projects on the ground."