Another matter that was subject to review by the Independent Expert was the matter of BEL interconnecting Caye Caulker to the national grid. The PUC believes it will be more cost effective for the company. Presently Caye Caulker runs on a diesel generator and is considered BEL’s most expensive cost of supply. The PUC had expected the project to be completed by this year but there were some inconsistencies and the project is yet to be commenced. Ambrose Tillett, the director of electricity for the PUC and Chairman John Avery elaborated on the decisions made following the independent expert’s report.
Ambrose Tillett, the director of electricity for the PUC: In its full Tariff review the PUC had indicated to Bel that it wanted disconnection to be completed in this year 2018 and BEL in their submission was telling us that they would not be able to have it completed until the end of 2019. You will recall that in the initial decision the PUC decided to penalize BEL effective July 1st in its rates by applying a penalty to the rate of return for the last annual Tariff period. The expert went through all the documentation from the full Tariff review and he could find no documentation with respect to this specific requirement from the commissions. BEL acknowledge that there was some discussion. The PUC obviously vividly remembers these discussion but because there was no formal documentation to support the decision, there was no evidence; the independence experts suggested to the commission that what it should do is move the penalty to the next Tariff period and include it in your determination that if it’s not Caye Caulker sufficient progress is not made by the next Tariff period we apply the penalty next year instead rather than this year. The PUC accepted that conclusion of the independent expert.
John Avery: By interconnecting that, instead of spending money on Diesel, BEL will actually be earning a big portion of that to pay back for the investment and customers will benefit overall and the country by a reduction of the importation of Diesel. The environment would benefit, customers would benefit financially, BEL would benefit financially so that would is a win win win situation and we remain adamant that we need that thing accelerated so the commission’s position is in that BEL needs to prior to February of next year have a contract signed for the execution of those works.
Avery says the contract should also provide for works to start by May 1 of next year, which would be in the midst of an annual review proceeding. If it is not done the PUC intends to reduce the company’s rate of return for 2019-2020 to nine percent. According to reports, BEL currently spends $3.3 million on the fuels to provide power on the island.