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JPS seeks rate hike


THE Jamaica Public Service Company (JPS) has asked the Office of Utilities Regulation (OUR) for an adjustment to its rates, which if approved would see residential customers’ bills going up by 3.8 per cent, and small businesses by 2.2 per cent.

The OUR advised yesterday that it is now considering the annual tariff adjustment submission and will make a decision by September.The JPS has asked the regulator to consider an average adjustment of 3.5 per cent of the non-fuel tariff charges, and an overall proposed total bill impact of 3.8 per cent.

The light and power company is further proposing that bill movement for large commercial and industrial customers (rate 40 and 50) increase by three to four per cent, respectively; and very large-scale businesses (rate 70) standard customers bills by 4.3 per cent.

The annual tariff adjustment submission comes as the JPS prepares to make arguments before a parliamentary joint select committee, which is considering changes to the 2015 Electricity Act. So far, major players in the electricity generation sector have called for changes to some of the provisions in the JPS licence, in order to open up the market to fair competition.The OUR noted that following its 2019-2024 tariff determination notice in December last year the JPS appealed a number of decisions before the electricity tribunal, and that some of these, raised in the company’s 2021 application, are still pending.In its filing, the company noted that the 2021 submission reflects “a balance between customer interests and fair treatment for the utility, allowing JPS to meet its mandate to provide affordable and reliable service, convenience, security, improve its overall efficiency, and enhance customer service delivery”.

It said the submission reflects challenges and opportunities, including the delay in the OUR’s final determination, which resulted in shorter revenue collection periods under the adjusted rates; inability of JPS to achieve targets that were set retrospectively; and the impact of the coronavirus pandemic on investment in the capital infrastructure, which have been brought forward to help improve services to customers, increase reliability, and support Jamaica’s economic growth and expansion.

Furthermore, the JPS said the submission took into account cost pressures from uncontrollable factors, such as foreign exchange movements, and that in order to mitigate the impact of these on the revenue, and to reduce the costs that influence pricing to customers, the JPS continues to modernise the grid by investing in smart devices on the network, upgrades and expansion of the transmission and distribution network.

The 2021 submission is provided for under the JPS’s 2016 electricity licence, which allows for adjustments to the company’s revenue targets annually, taking into account economic factors such as the foreign exchange rate and movements in inflation.The Government is expected to enter into negotiations with the JPS soon in relation to its current licence, which expires in 2027.

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