Caribbean360
CMC: Guyana– The Guyana government has defended the decision to increase electricity rates by nearly 27 per cent, saying that the Guyana Power and Light (GPL) Inc., has been experiencing constraints over the past few years as a result of high technical and commercial losses.
In addition, Prime Minister Samuel Hinds says here the financial position has been compounded by the decision of the opposition to slash GUY$5.2 billion (One Guyana dollar = US$0.01 cents) subsidy from the 2013 national budget.
The GPL has submitted its proposal for the tariff increase to the Public Utilities Commission (PUC).
Prime Minister Hinds today called on consumers to view the proposed tariff increase as one that is coming after five years of no adjustment during which time oil prices had risen by about 60 per cent.
He said the cost of oil constitutes about 80 per cent of the total cost of providing electricity.
At present, the average price per kilowatt hour is GUY$63 and with the 26.7 percent increase the new rate will be about GUY$80 per kilowatt hour.
Prime Minister Hinds, who has responsibility for the electricity sector, acknowledged that the increase will be very demanding on consumers.
“This 26.7 percent is a big step, but it comes after five years of no increases and five years of greatly increased cost, especially for oil…the alternative for the future is for the annual review to be put into effect, in which case one would probably see increases of no more than five percent per year,” he said.
The Prime Minister said that the utility needs to have enough money to keep its operations running, and if this tariff is suppressed then ultimately, the level and quality of service will be degraded.
He rejected the claims made by the opposition and other political commentators that the company is not being properly managed and said that the big cost factor is technical and commercial losses.
