Electric bills ‘shock’ consumers

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.”

1 COMMENT

  1. Well, try doing without aircon for 24 hours a day, for starters. Many of us can remember having no aircon at all at home, let alone in freezing shops, businesses and arcades.
    Is there a Government regulation prescribing the minimum temperature in public buildings (including Government offices as well as banks, shops etc)? It could perfectly well be set at 22 C/ 72 F, or even a point higher, without unreasonable discomfort.
    Come on, you eco-people, get onto it!

  2. 72F? thats freezing man, 75-80F is more like it. We getting to used to A/C for being island people.

    On a side note, how much markup do these gas stations put on a gallon if costs CUC 4 a gallon for diesel? the duty on gasoline is only 0.15c more.

  3. Solar power is definitely the way to go — then CUC will no longer rape pillage us. Why isn’t the government offering incentives for homes that convert to solar? In most cities in North America, you can sell your excess power from Solar Panels back to the power company, even further reducing your own costs. NOT CAYMAN. The CUC wants ALL your solar electricity, then they will sell it back to you at the going rate!!! Who in their right mind would do this? No wonder everyone says No Thanks (well, more rudely than that). CUC wants to hold us hostage. But folks, with solar power you will see the bills come way down — it pays for itself over time. This is the direction the government should be headed — and it’s more green too.

  4. What I don’t understand is why, an electric bill for example; electricity alone costs just under 300, and then the charge for fuel is well over 800!!!! I don’t understand it at all. This price hike is way too much for some consumers to afford. Its either pay electricity bill or have no groceries for a month, or buy groceries and have the electricity turn off.

    These prices really need to go down, for example give consumers a break by charging them alone for the fuel, if the actual surcharge is greater than the actual electricity used.

    But I highly doubt the electric company would do something like that.

  5. Well mermaid. The reason there is no government incentive. Is because if you generate more power than you need with solar. You must PAY CUC for your extra electricity you generate. NO WHERE in the world does any country’s power company do this.

    normally, most power companies pay you 50% to 30% for the extra power you generate. Becuase the power companies charge others for the power you generate. And it’s good for the company, becuase they don’t have to generate as much electricity.

    make no doubt. CUC has this island by the short and curlies.

  6. @CaymanMermaid, You are so right, solar is the way to go and the current Grid tie program is a disincentive. Cayman should have two way meters and the government’s support should be to mandate that the two way meter be status quo. It would not cost a public cent.
    I am off-grid solar, I keep a CUC connection in case of an extraordinary large draw on the batteries on a rare occasion. This backup insurance costs 5.25 per month.
    I have to monitor and fill my batteries and keep the AC on higher settings than the George Town Jewelery stores, but it is THE way to go. My house is old, needs better insulation, still the solar system runs a regular household with regular appliances. I did switch many light bulbs to LEDs and use propane to cook and for the clothing dryer. The installation and shopping was made easy by Mega Systems and they have been fantastic with any electrical issues to date. This is not a scary life change, not rocket science. I encourage everyone to consider this move – my break even point is close to 7 years now with current CUC rates.

  7. Blah, Blah, Blah…. CUC appear to have no concept of the hardship they are inflicting on the community. Real people are experiencing real pain. A colleague of mine had a whopping bill for this last period of CI 2,200. How do they justify this?

    I am aiming to begin a discussion group made up of real people who are prepared to tell their stories of the sacrifices they are having to make to meet this exhorbitant charge. If I can get together enough interested participants, I have a TV station interested in filming their stories for later airing. Those wishing to participate are encouraged to email me at [email protected]. You should leave me a contact number and I will contact you.

    It’s time we came together and put together a case as to why this monthly charge is unsustainable.

    We need to be asking questions like, why do CUC advertise, with no competition on the island, advertising is an unnecessary expense and who is paying for that advisting if it’s not the consumer. Where do they profits go, are they investing in alternative sources of energy and if so what are those sources and how far down the road are they.

    At some point oil is going to dry up and without investment in other sources of energy, Cayman could end up back in the dark ages if something is not done now.

  8. I think we are paying for the generator problems earlier in the year. Don’t forget that CUC gets a guaranteed return so the cost has to be passed on and the quickest way to do that is at the hottest point of the year.

  9. Yes indeed, supermarkets, stores and restaurants would do well to up the temperature a bit on the A.C -why so cold??
    They seem to be uncomfortably cool – not an incentive to linger- we actively avoid !!

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