Government Steps In To Help Ease Burden on BEC Consumers.

Mr. Ingraham also said that the Government will direct BEC today to immediately restore without any reconnection fee, the electricity supply to all residential consumers who have had it disconnected for failing to pay their bills in full;

Prime Minister, Hubert Ingraham today announced a series of initiatives with the intent of easing, in the short term, the burden on customers of the Bahamas Electricity Corporation (BEC) which has accumulated over the past two years amidst spiking global fuel prices. One key initiative announced for the short term, was a directive to BEC "to limit until 31st December, 2008 the surcharge on electricity billings to a maximum of 15 cents per kilowatt hour - for residential consumers that utilize 800 kilowatts of electricity or less per month".

Addressing the House of Assembly on Wednesday September 17, Mr. Ingraham also said that the Government will direct BEC today to immediately restore without any reconnection fee, the electricity supply to all residential consumers who have had it disconnected for failing to pay their bills in full; Furthermore he is also directing BEC to permit residential consumers to enter into agreements with BEC by October 10th, 2008 to pay BEC 25% of all outstanding bills and agree to pay the balance of the arrears over a 2 year period while being required to keep current, the payments on all future bills.

Directly speaking to the particular situation of the unemployed and the elderly, the Prime Minister announced that, in regards to non-contributory old age pensioners who are unable to pay electricity arrears under these terms, the Government is requiring that they be allowed to go to the Department of Social Services to be assessed for appropriate assistance; It is also being directed, that unemployed heads of households with children be also allowed to go to the Department of Social Services in order that their circumstances may be investigated and a determination made as to what assistance may be given to them.

The announcement by Mr. Ingraham in the House on Wednesday, was prefaced with an analysis of the current extraordinary increase in the cost of fuel on the world market seen over the past two years that has in turn been passed on to Bahamians. He cited the increase of crude oil, the base product for fuel, which rose from $60 per barrel in 2006, to some $140 plus earlier this year. That translated to a $21 million increase in the cost of fuel to BEC from $20 million in August 2006 to $41 million in August 2008. "This unprecedented and uncontrollably high cost of fuel over the past few months has significantly contributed to unusually large increases in electricity bills of consumers of electricity supplied by The Bahamas Electricity Corporation (‘BEC’). Residential consumers have experienced an increase in the fuel surcharge on their electricity bills from less than 11 cents in August, 2006 to almost 25 cents in August, 2008", said the Prime Minister.

He described how as a result, many consumers have been unable to pay their bills and have had their electricity disconnected by BEC. According to Mr. Ingraham, It is unacceptable, that 5000 residential consumers have had their supply of electricity disconnected, the vast majority of these being in respect of outstanding bills of less than $1,000.00 BEC is being further directed to reverse their policy which requires residential consumers to pay all arrears in full before any disconnected electricity supply is restored and return to the policy that required only a 50% payment of arrears prior to reconnection of supply.

In announcing the social relief initiatives Prime Minister Ingraham exclaimed that "Such a state of affairs demands a response from a caring government; a response that will bring relief to more than five thousand families and help them through a difficult economic situation; a response that will allow more time for the implementation of medium and long-term strategies that are being devised to improve energy conservation and eventually to bring about sustained reductions in the cost of electricity, particularly through the development of alternative sources of renewable energy".

To finance this step the Government will lend $4 million to BEC from the Government’s sundry capital allocation account to be repaid by BEC within the next 2 years. BEC is also being asked to apply the Government’s $600,000.00 annual dividends ordinarily payable by BEC to the government, towards ameliorating or lessening any potential future increases in the electricity surcharge as a consequence of any future shocks in the cost of oil over the next two years. An independent firm will also be retained to conduct an operational audit of BEC and make recommendations to bring increased efficiencies to BEC.

The Government will also through the Minister of The Environment begin an intense consumer education campaign on energy saving measures that can be taken.

For Grand Bahama, a meeting will be held with representatives of the Grand Bahama Power Company within the next week to explore means by which similar relief can be brought to consumers of electricity in that northern island.