C.F.E. TO SELL CHEAPER POWER TO B.E.L.

Gov’t negotiator gets C.F.E. to sell cheaper power to B.E.L.
One of the last things you wanted to hear today was that the world price of petroleum shot up again. Oil is now retailing for a one hundred and thirty-six U.S. a barrel, up two bucks from last night. The trickle down effect is of course higher prices, in fuel in the first instance, which would then trigger higher costs in everything else. One sector that feels the petroleum pinch right off is Belize Electricity Limited which is presently awaiting the final decision of the Public Utilities Commission on a rate increase request. Reaction to the proposed price hike has been negative from the public and in response, the Government of Prime Minister Dean Barrow has undertaken several initiatives in an attempt to give consumers a break. One of those efforts included a visit to Mexican power company Comision Federal de Electricidad by Government’s Chief Financial Advisor Manuel Esquivel and electrical engineering consultant John Mencias. Those meetings took place on June fifth and as Esquivel pointed out to the press this afternoon, the timing is crucial because B.E.L. is currently in contract negotiations with C.F.E.

According to Esquivel, “while C.F.E. could not commit to reducing the energy charge per kilowatt hour for power supplied to B.E.L., they have agreed to consider a reduction in a number of other charges” that make up the “total cost of the supply”.

So how much are we talking about?

Manuel Esquivel, Financial Advisor, G.O.B., “If everything went smoothly and well, it could result in about seven million a year. So it could be a considerable amount. They made it clear that they really couldn’t do much about the actual kilowatt cost of the energy because they are operating under very strict national regulations with regards to their own domestic cost of power. They are saying we are here for Mexicans. What we do for Belize—and we try to do what we can do—we can’t offer you what we’re not offering Mexicans. The Mexican Government as well as C.F.E. are very keen to seeing themselves becoming more involved with Belize and energy. They are urging, which we have already started to put in place, that Belize should have control of energy policy and energy planning. Right now, in the case of electricity, it’s B.E.L. that does those things and we and the people tend to react to it. That’s upside down. The Government has the obligation to make sure people get affordable power so the government must be the one that does the planning and sets the policies. And as I said, even before going I discussed with the prime minister the need for us to have, as it were, an Energy Planning Department within the government itself.”

Janelle Chanona, “And as far as when the new prices would take effect that C.F.E. is negotiating with B.E.L.?”

Manuel Esquivel, “Well, that would be the first of August. So there’s not a lot of time but it’s a good time to do it before that date comes.”

This afternoon B.E.L.’s Chief Executive Officer Lynn Young told News Five that the company welcomed Government’s efforts and referred to the negotiated agreement as an “improvement in negotiations with C.F.E.”. But Young maintains that he is cautiously optimistic because the end savings to the public will depend heavily on fuel prices as the cost of power is indexed to the cost of oil. That hesitation was shared by the Public Utilities Commission as Chairman John Avery maintained to us today that the P.U.C. is taking the still escalating price of petroleum into consideration as it prepares to release its final decision on B.E.L.’s rates. Those prices will be announced no later than June twenty-sixth.