Fortis Belize Faces Pressure to Lower Rates Amidst Renewable Energy Discussions

Fortis Belize Faces Pressure to Lower Rates Amidst Renewable Energy Discussions

Fortis Belize has responded to the Prime Minister’s call to lower their rates. On Friday, PM John Briceno said he didn’t want to discuss Fortis’ ability to increase its power supply until the company considered lowering its rates.  In 2019, Fortis, the country’s only producer of hydroelectricity, proposed to build a solar plant that would have increased its power production.  Its bid was unsuccessful, but to date, they remain hopeful and open to the possibility.  However, when asked about Fortis’ inclusion in solar power, the Prime Minister said he was most concerned about the company’s electricity rates, which increase yearly. Today, our newsroom spoke to Fortis’ CEO, Kay Menzies, who clarified that the increase is minuscule and elaborated on how the company continues to sell one of the cheapest forms of energy.  

Kay Menzies, CEO, Fortis Belize: “There is a fixed rate arrangement. It was negotiated a long time ago and it is something that we take in pride in the fact that we are not the most expensive supplier. We can’t be as cheap as solar for the simple reason that there is a great deal of investment in operations and maintenance on an annual basis. We have special technicians within the Fortis Belize team, highly trained individuals, forty five of them all Belizean and they have been trained to keep the turbines going, keep the infrastructure going and also we hire a large number of contractors in the Cayo and outside the Cayo area who also help us to do the projects we need to do so its very labor intensive, very capital intensive to keep those hydros in pristine condition. They have to last for a very long time. The initial investment in them was in the hundreds of millions as well so to compare that to solar is a little bit unfair at this time and what we did was recognizing that we need to improve rates I mean everybody, let me make the point that our rates in Belize are quite competitive with the rest of the Caribbean. We are competitive with certain parts of Central America, all of that anybody can look up online but for us the main thing is the reliability of the system, the idea that when you flip that switch your fan or your light comes on. I say fan because it’s kinda hot out there right now. But you want to make sure that you have electricity when you need it. That is what the hydros allow for because they are extremely reliable, this is probably the most reliable supplier BEL has on the grid. Our rate is about 90% availability which is incredible given the challenges being faced by the team.”

Menzies added that apart from producing hydroelectricity, the company conducts several studies to ensure the environment surrounding its three dams remains healthy. She also explained that the energy Fortis sells is not only clean and economical but reliable due to the constant investments being made. 

Kay Menzies, CEO, Fortis Belize: “It’s a very small percentage, a fraction of cents indeed. Remember you’re talking at per kilowatt rates you’re talking cents anyways so the small percentage here is actually lower than inflation and it is intended to again we’re buying spare parts, we’re upgrading equipment, we’re paying people who deserve a good wage for what they’re doing and in the same way that none of us would work for the same salary we had twenty years ago or even ten years ago or maybe even five years ago in the same way it’s difficult to say that you would be able to perform the services that we perform from a rate that’s twenty years old. It’s unrealistic if you want us to provide good quality power and maintain that 90%+ availability that we do. That requires a fair amount of investment all the time and none of our suppliers are keeping their prices at the same time. We have been victims of inflation that we don’t pass on because ours is a fixed rate. It’s a fixed rate with a small escalation that really has no impact on the cost of power beyond the challenges that BEL is facing otherwise. In point of fact I would say one of the things we have to understand is that electricity does have a cost but it is the basis for the economy to flow and we’re  very conscious of our role in that, in making sure that the economy grows, that the demands are met and we’re willing to be a part of meeting that demand. There is nothing there when you look at the numbers that you could say that Fortis is exploiting Belize. Fortis has actually been a development partner in Belize’s development, in BEL’s development to the best extent that they’re able to be and they’re willing to be more of a partner if so desired but we fulfill a role as defined under law and we’re very careful that we make sure we do fulfill that role to the best extent possible because we know who we’re serving at the end of the day. It’s not BEL, it’s not the government, it is the people and businesses of Belize.”

Fortis added that it has revised its solar scheme proposal and remains open to the idea.

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