Lavish Lindeners urged to conserve on electricity use
– average household pays $2000 per month
Linden Electricity Company Incorporation (LECI) said the annual multibillion subsidy offered to Linden can be reduced by 50 per cent if Lindeners conserve on electricity.
In this year’s budget, Government allocated $3.2 billion to assist LECI and Kwakwani Utilities Inc for provision of electricity to 10,500 customers in Region 10. From the grand total, LECI will receive $2.830 billion while the remaining $345.7 million will be used to subsidise Kwakwani Utilities Inc.
Speaking with Guyana Times on Monday, James said on average a household in Linden consumes approximately 280 kilowatts per month when electricity consumers in other parts of Guyana are consuming approximately 150 kilowatts per month, per household.
While the consumption rate by residents has reduced from an average of 300 kilowatt per household per month, James said a further reduction to 150 kilowatts can result in the subsidy being slashed by almost 50 per cent.
Guyana Times was told that the multibillion dollar subsidy can be removed completely and channelled towards other developmental activities, if there is an increase in electricity tariff to $60 per kilowatt per hour. Currently, residential consumers on the Mackenzie shore pay $5 per kilowatt while business entities are charged $12 per kilowatt. Meanwhile, James said LECI only managed to rake in a meagre $180 million in revenues from Linden consumers while $20 million was generated from the Ituni branch at the end of the year.
Additionally, in 2013, the corporation received approximately $24 million from the Linden Utility Services Co-op Society Limited (LUSCSL), which it sells electricity to.
But even when all the revenues are merged, the LECI CEO said the money is still highly insufficient to manage its affairs, hence, Government subsidy becomes necessary. The revenues garnered are used for transmission, distribution, meter reading and billing while the Government subsidy is paid to Bosai Minerals Group Guyana Incorporated (BMGGI) for the generation of electricity.
With residents paying only $5 per kWh, their bills are less than $2000 at the end of the month, a source told Guyana Times.
Less dependent
With an increase in tariff, the mining town can become less dependent on Government’s subsidy.
“Currently, residents are not paying for what they are consuming because their rates are highly subsidised by Government… if there is an increase, the company’s operation can become more viable,” the source added.
The source said the corporation is struggling to keep its head above rough water as there is often little profit remaining, when the operational cost is billed at the end of the year.
In 2012, the Donald Ramotar administration had announced a hike in electricity tariffs, but this announcement was met with a series of protest action. It subsequently evolved into deadly unrest when protesters and ranks of the Guyana Police Force clashed at the Mackenzie/Wismar Bridge on July 18, 2012.
To bring an end to the violent unrest, the Government and the Region 10 Regional Democratic Council signed an August 21, 2012 agreement which give rise to several committees. Among the committees was the Technical Committee, which was mandated to investigate the electricity situation in Linden, including the history, the costs, the tariff structure and the subsidies.
A study on Region 10’s economic circumstances and its ability to facilitate an increase cost of electricity, consideration of the advantages and disadvantages of the integration of supply of electricity in Linden on the national grid, and recommendations are among duties that are yet to be executed by the Technical Committee.
Promises
Meanwhile, Prime Minister Samuel Hinds during an interview with the National Communications Network (NCN) over the weekend said Government has maintained its promise to the people of Linden. The Government and the region have agreed that there will be no increase in electricity tariffs until the Technical Committee completes its work. However, he said the subsidy per customer will work out to be $291, 000 per year or close to $24,000 per month on the average. He too is arguing that Lindeners consume approximately 50 to 100 per cent more in electricity than persons in the capital city. According to the Prime Minister, if persons cut back on their electricity consumption, the state would have more but their consumption will not affect their comfort.
Meanwhile, former Georgetown Chamber of Commerce and Industry (GCCI) President Clinton Urling said in the 2014 Budget, the Government should have used the opportunity to tie subsidy and declare Linden as “an electricity free manufacturing zone” to encourage manufacturers to set up operations and pursue the industrial diversification of the economy.
“These electricity zones could offer free electricity for a number of years and gradually include charges as companies’ financial and operational performances improve,” Urling suggested during a recent press conference.
source: Guyanatimes