Amandala, 18 January 2006
BELPO asks PUC to revoke BEL rate increase
Tell us the truth; show us the documents, says Candy Gonzalez
by Adele Ramos-Daly
BELIZE CITY, Fri. Jan. 13, 2006
`The Belize Institute of Environmental Law and Policy (BELPO), an organization based in Cayo, has written to the Public Utilities Commission (PUC), asking it to review and revoke its decision to grant the Belize Electricity Limited (BEL) a 5.4 cents (or 13%) increase in mean electricity rates as of January 1, 2006.
In a letter dated, Thursday, January 12, 2006, BELPO’s vice president, Candy Gonzalez, argues that the process of public consultation was " a farce," since Belizeans had a very short time to review BEL’s proposals for a rate increase, submitted on December 20, 2005.
The law allows concerned citizens up to 30 days to seek a revocation of any PUC decision.
"The PUC’s decision of 31 December 2005, to allow BEL another rate increase, added to the rate increase approved earlier in 2005, will place a greater burden on all of the people of Belize and violates the Electricity Act’s requirement of ‘reasonable’ rates," Gonzalez writes. "It is a cruel joke that such a decision was taken while Belizeans were celebrating the holidays with their families. This, too, is a patent violation of the PUC and Electricity Acts, in that the opportunity for public comment was so cynically dispensed with."
The letter cites a central concern with respect to the recently introduced Chalillo Dam.
"Many Belizeans and other experts advised the PUC that the Chalillo project would cause an increase in costs, NOT a decrease," Mrs. Gonzalez tells the PUC. "We deserve the truth. We deserve to know how much this project has cost, and will cost; we have the right to know whether BEL and BECOL have renegotiated their power purchase agreements. These agreements cannot hide behind a veil of secrecy."
In its final (and only) decision issued on December 31, 2005, the PUC said that the mitigating effects of Chalillo, which were anticipated, were not being realized.
"As a concerned Belizean and on behalf of many similarly concerned Belizean citizens and organizations, I write pursuant to Electricity Act sec. 13(6) and PUC Act Part VII sec. 32 and 33, to request that the PUC review and revoke its decision of 31 December, to grant an electricity rate increase to Belize Electricity Limited," she writes.
Gonzalez also requested a number of documents from the PUC, including the Power Purchase agreements to which BEL is party, including that for Chalillo and Mollejón, and the associated costs upon which the PUC made its decision to grant BEL the increase.
She also requests that these documents are made available on the PUC’s website, www.puz.bz.
BELPO is a group of about 20 professionals, according to Candy Gonzalez. It was registered as an NGO in 1995 and is a member of BACONGO, the Belize Alliance of Conservation NGO’s, which fought BECOL over Chalillo all the way to the Privy Council, but lost.
Gonzalez had also sat on NEAC for BACONGO.NOTE: The following are the PUC Commissioners: Dr. Gilbert Canton, chairman; Ernest Alfred Chanona, JP, Mary Martinez, Harry Noble, Ilona Smiling, Santiago Mendoza, and Oscar A. Sabido, LL.B.
BEL directors are: chairman - Robert (Bobby) Usher, deputy chairman – H. Stanley Marshall, Lynn Young, Fernando Coye, Richard Hew, Philip G. Hughes, James Lea, Karl H. Menzies and Yasin Shoman.
The Government of Belize holds the Special Share in BEL and thus the chairmanship.
The PUC is a statutory arm of the Government of Belize.
---------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------
Stories as of January 17, 2006, posted at 0:32 pm
--------------------
ENVIRONMENTAL GROUP ASKS PUC TO RESCIND RATE INCREASE
A letter has been sent to the Public Utilities Commission asking it to review and revoke the decision to grant a raise to Belize Electricity Limited. Love News spoke to Candy Gonzalez of the Belize Institute of Environmental Law and Policy.
Candy Gonzalez:
The rulings within the P.U.C. are that they are supposed to notify people and that they are supposed to allow people to comment so that a wise decision could be made on rates and what's best for the consumer as well as looking out for the public utilities. They are supposed to balance everything, now when they sent the request for the rate increase for B.E.L. they sent it right during the holidays. They sent it on the very same day a new law was passed, that is statutory instrument number 145. They also gave only a short time to comment when you consider when it was put in the paper and when comments had to be in was right during the holidays. There was only one paper that came out so essential there were only three working days that were available to anybody even to find out never mind to actually sit down and write a comment and that's wrong.
We asked Gonzalez why the need for the letter.
Candy Gonzalez:
Under the law you have thirty days to comment on the decision that the P.U.C. makes. Within the thirty days when we wrote the letter not only do I believe that they have not given people a chance to view the information but most of the information they contend is private B.E.L. doesn't want released to the people. Like what are the power purchase agreements? What's the cost for construction of the Chalillo Project? We've never been told the truth about those things even in the news interviews they've said everything from 33 million up to 100 million dollars U.S. Now that's a pretty wide stretch and they should know a little bit closer as to how much it's going to cost them between 33 million and 100 million. To keep saying the reason things went up is because of a three-year delay because of the court case then what people don't remember is that construction never stopped during the court case. There was not an injunction, the court allowed B.E.L. to continue so they continued construction. It had to do with the faulty geology and the fault that they took out the fault line out of the map that's on the E.I.A. and they actually had to redesign the dam to make it safer because the geology studies were incorrect. So it was not any court case or the people protesting that held up the job but it was the inaccuracy of the information they were dealing with.
------------------------------------------------------------------------------------------------------------------------------------------------------
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
email: godsman1@btl.net or belpobz@starband.net
FAXED: 227-1149
30 January 2006
Dr. Gilbert Canton,
Chairman, Public Utilities Commission
63 Regent Street
P.O. Box 300, Belize City, Belize
RE: Revocation of Electricity Rate Increase Decision
Dear Dr. Canton:
Thank you for your quick response to my letter of 12 January 2006. It would have been more constructive had you taken the time to give the request a more thorough appraisal rather than a defensive one.
You state that your decision technically gave the public enough time to comment, though no one did. Our objection was not in your failure to follow the letter of the law, but the failure to follow the spirit of the law, which is to encourage public participation.
To be clear, the complaint is that these decisions were made in haste. Middle-income Belizeans now must pay at least 50% more for electricity this year or shut off their lights. The rates are now also a major hindrance for Belize’s businesses, especially the productive sector, and discourage economic growth. Yet you have decided that these are not “material or substantial” objections.
You also suggest that it is your duty to quickly give BEL the New Year’s bonus it requested and to prevent Belizeans from seeing the “private” business documents of BEL, a public utility provider.
In coming to this decision, you emphasize the discretionary powers of the PUC to reconsider (or in this case, not to) its decisions. While the PUC and Electricity Acts clearly give the PUC a great deal of discretion, they are equally clear that this discretion is not unlimited. For example, the PUC must ensure that rates are reasonable. The PUC Act says: “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 decisions to grant BEL rate hike after rate hike with no meaningful public input is an abuse of the discretion entrusted in the PUC. How can the PUC “ensure” that the services rendered are “satisfactory” and that the rates are “reasonable” without consulting the public?
The fundamental principle of the PUC Act is that public utility rates “shall be fair and reasonable.” Part III, section 11(1). The PUC has the duty to ensure the fairness and reasonableness of the rates, and is given strong powers to carry out this duty. In response to a complaint about rates the PUC is required to hold a hearing, conduct an investigation (section 15(2)), and set fair rates to protect the Belizean public. PUC ACT, part III, section 15(1). The law is on our side: “In any proceedings under [PUC Act] section 15 above, the burden of proof to show that the rate complained of is fair and reasonable shall be on the public utility provider.” (section 16). With this in mind, I reiterate my complaint about BEL’s rates, and urge you to conduct a public hearing and investigation to reconsider these rates.
I also reiterate the request for the cost of power estimates you used in calculating the new rates. You asked for a clarification of this request. Your 31 December 2005 decision provides a “forecast” for the cost of power for 2006 of $.255 per kilowatt hour (kWh) and
then explains that this is composed of forecast costs of electricity from gas, diesel, CFE, BECOL, and HydroMaya. In the report on your website, you name the sources of power and then give an aggregate estimate -- but you never break it down. However, Steve Usher, Vice President of Operations, has broken it down. He is quoted in the San Pedro Sun of 25 January 2006, as saying the energy supplied by the Chalillo and Mollejon plants costs about $.17 per kWh; electricity purchased from Mexico averages $.44 per kWh; and
energy from diesel generators averages about $.42 per kWh. It is evident the figures have been compiled. Furthermore, in Adele Ramos’ article (Amandala 8 Jan. 2006
‘Killing with the Kilowatts”) she reports that you have stated that a 12% profit is factored into the current rates.
I request the (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).
To claim that these agreements with a monopoly public utility contain privileged business information is simply no answer. These documents are public documents and must be released to the public, as was demonstrated by the public release of the Third Master Agreement with BECOL (which shows such agreements are for the public view). Without this information, we can only conclude that there is no rational basis for your decision.
Belizeans pay Fortis/BEL the highest rates for electricity in all of Central America. The most recent rate hike is due to Fortis/BECOL’s misguided and expensive Chalillo dam, to extortionary diesel rates, and to extortionary profits. Each year, Canada’s Fortis reports more and more profits squeezed from Belizeans. Speaking on behalf of many concerned Belizean citizens, organizations, and businesses, I ask you to take up your duty to listen to our complaints in a public hearing, and to protect us against this price gouging. PUC published two full-pages ads in the papers this week. These ads could have been used to announce a public meeting on the rate hikes!
Sincerely,
________________________________
Candy Gonzalez, Vice President
Belize Institute of Environmental Law and Policy
P.O. Box 54, San Ignacio, Cayo District,
Belize, Central America
