BELPO Challenges Electricity Rate Hike--
April 19, 2006 letter

Belize Institute of Environmental Law and Policy
P.O. Box 54, San Ignacio, Cayo District - Belize, Central America
Tel. (501) 804-2032 – Fax: 824-2685
 

April 19, 2006

Dr. Gilbert Canton,
Chairman, Public Utilities Commission
63 Regent Street, P.O. Box 300, Belize City, Belize

FAX: 227-1149

RE: † Failure to Respond to Request for Information

Objection to Application for Annual Review Proceeding

Dear Dr. Canton,

On 7 March 2006, we wrote to remind you that we have not gotten a response from our inquiry of 30 January 2006. It is now mid-April, BEL has already stated that we should brace ourselves for future rate increases (but be quiet, because they are not coming right now) and yet you have failed to provide us with the information justifying their last increase.

BEL has now submitted (on 31 March) an application to the PUC to change the current tariff structure. During this Annual Review Proceeding (ARP) the PUC “will review BEL’s submission and the company’s operations for the past year to ensure that the objectives set out in the 2005 Full Tariff Review Proceeding (FTRP) are achieved.” (from PUC notice)

What is the meaning of this application or its possible repercussions on ratepayers in the future? Does it have to do with BEL’s stated intention to upgrade? They say they intend ".to invest over $177 million in projects to improve and extend service over the next five years.” What are the projects? What are the costs? We are still in the dark over the true cost of the Chalillo Dam.

Will this “review” give a go ahead for future increases? How can we comment on something we don’t understand? How can the public respond when you fail to provide us information?

In our 30 January letter, we reminded you, the PUC, (and it is worth repeating) that, “It shall be the duty of the Public Utilities Commission to ensure that the services rendered by a public utility … are satisfactory and that the charges imposed in respect of those services are reasonable.” PUC Act, Part V, section 22(1). The fundamental principle of the PUC Act is that public utility rates “shall be fair and reasonable.” Part III, section 11(1).

Your 31 December 2005 decision provided a “forecast” for the cost of power for 2006, without providing the facts/figures behind that decision. Therefore, to remind you, we requested (1) individual cost estimates for electricity generated by gas, diesel, CFE (both the contractual and spot market figures), BECOL (Chalillo and Mollejon), and HydroMaya; (2) the dispatch profiles you estimated for each; and (3) the power purchase agreements that provide the basis for this information. There's no question that there are power purchase agreements for each of BEL's sources (otherwise, how does BEL know how much it is paying).

People are hard pressed to make ends meet. We face the possibility of rate increases in every part of our daily life. Thus, when we see an application for a change in tariffs but don’t know what it means, other than no immediate increase in rates, it is easily slipped through with no comment.

We have learned that we cannot allow any “Application” from BEL to go unnoticed or pass without comment. We want to know what the implications of the Application for Review Proceedings are? This includes a clear understanding of how such a review will affect future rate increase requests.

Please accept this letter as an objection to the Application for ARP until such time as the above requests are met. It is also a request to have all documents made public that relate to BEL’s operations for the past year and any other information you are using to review the tariff structure.

We are still waiting, and still want, the information relating to your approval of BEL’s last rate increase of 31 December 2005.

We assume these requests are clear enough to understand. If there is any confusion, please let us know.

Sincerely,

Candy Gonzalez
Vice President, BELPO