I had cautioned consumers via this blog last year that the electricity rate application would not be a request for a simple rate increase. In other words in a worst case scenario which assumes the company gets everything it wants Barbados Light & Power Co. Ltd consumers would not be paying a five or 10 per cent increase in rates across the board. Confirmation of this has come from none other than Peter Williams, Managing Director of BL&P following the decision by the Fair Trading Commission last month to grant the company all the depreciation rates requested.
So what are the implications?
Well we have to wait on the application in another two months or less to get these details.
Currently, the electricity bill is made up in two ways : a Fuel Adjustment Clause and usage rate. So if the fuel charge goes up and we use more electricity our bills are higher on both accounts.
If I interpret what Mr. Williams has confirmed correctly the company will be seeking a new mechanism or an additional way of charging consumers.
I had assumed, and I speak subject to correction, that some consumers, in a worst case scenario, could end up spending more on fuel adjustment, more if their usage goes up and more under this yet to be revealed mechanism to be revealed.
The looming rate case could have major implications for the cost of service for business and consumers alike, especially small businesses. Electricity is a major cost in any business hence there could be major implications for business as well ordinary consumers with limited incomes, exagerated moreso by the global financial meltdown.
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