Caribbean Utilities Company Limited has increased bills recently prompting many in the community to question the higher fees.
The company issued a statement in response to questions asked by the Caymanian Compass on behalf of those who had been contacting the paper regarding the issue.
“Customers receiving their bill would have seen a spike in the fuel cost line item related to fuel purchased by CUC in April when the cost was CI$4 per imperial gallon. This translated to a calculated fuel cost factor of 25 cents per kWh. In March, fuel costs were at CI$3.78 per imperial gallon which translated to a calculated fuel factor of 23 cents per kWh. The calculated fuel cost for July is also 25 cents per kWh,” read the statement.
CUC’s president and CEO Richard Hew said the process of applying the fuel cost factor adjustment to customer’s bills takes place over a two month period, during which time the prices are reviewed and approved by the Electricity Regulatory Authority.
“That means that the total cost of fuel to CUC in April, including government’s duty of $0.75 per imperial gallon, was applied to customer’s bills in June and the cost of fuels in May will be applied to customer’s bills in July.”
Mr. Hew said CUC does not benefit in any way from high fuel costs, as only actual fuel costs are recovered without markup. He pointed out how people can be proactive in easing the impact of the higher electricity bills.
“While we always encourage customers to use electricity efficiently, with fuel costs rising to the highest levels since 2008, coupled with warmer temperatures, we are encouraging customers to be especially vigilant of their electricity consumption during the summer period,” he said. “When there is reduction in the price of fuel, customers will also see a decrease in fuel costs on their bills. CUC’s per kilowatt hour base (nonfuel) rates have remained unchanged at an average of CI$0.1039 for the past two years and are, in fact, lower today than they were in 2002.”
CUC purchases fuel through a competitive bid process using long term contracts based on world fuel prices.
The Electricity and Regulatory Authority released a statement to consumers on 7 July, saying the Authority did not receive notice from CUC prior to the company making a change to its monthly bills, which separates the portion of fuel charges that represent import duty charges on CUC fuel purchases used in the production of electricity.
The statement went on to assure customers the new line item was not a new charge, as “no new charges can be added unilaterally by CUC without proper regulatory approval.”
Previously, the total fuel cost was a one line item, including the government fuel duty. However, CUC said in a statement issued Friday, 8 July, “In an effort to improve transparency, customers can now see what portion of their bill goes to government fuel duty.”
In response to an ERA statement indicating the government would be launching a monthly rebate which would show up as a credit on CUC monthly invoices and that the final details of the rebate are being worked out and will be announced via Government Information Services, CUC said, “CUC has been advised by the Electricity Regulatory Authority that it is government’s intention to provide a rebate to electricity customers. However, the exact details of the rebate, including when it would begin to appear on customer’s bills and the amount, have not as yet been provided to CUC.
Once it is confirmed and we know the details we are prepared to work with government and the ERA to facilitate the application of any such rebate to customer bills.”