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Electricity Hike by 44 Per Cent
Posted: Thursday, February 9, 2006

By Stephen Kangal

In spite of the deliberately misleading and economical- with- the- truth PR campaign being conducted by the RIC in the print media on the proposed electricity hike, this increase will be a whopping 44 % for 2006 only. There will be further annual increases from 2007 to 2010. This calculation was endorsed as being accurate by the RIC at the consultation held at the Chaguanas Senior Comprehensive School on Tuesday 7 February.

The hike will have an adverse domino effect on the cost of living with food prices already spiraling out of control. Commercial electricity- rates will go up by some 55% and this increase will also be passed unto the consumers as indeed the recent petrol price hike introduced by Manning showed. Electricity is more prevalent in use in T&T than petrol.

My current VAT inclusive bill is $340.66 for consuming 1309 Units (Kwh). In accordance with RIC new Kwh charge, for the first 400 units (@29 cts) I will now pay $116.00 (100 % increase), the next 600 Kwh (@32 cts) will cost me @192.00 ($100 increase) and the final 309 Kwh (@35cts) will cost me $108.15 ( increase of $53.00).

When you add a fixed charge of $9.00, an illegal $1.00 disaster charge and VAT charge ($64.00) my new electricity bill effective 1 March will be increased by $150.00 to $490.00.

That amounts to a whopping 44 % increase in my household expenditure for electricity that is more than 6 times the current inflation rate of 7%.

I maintain that the proposed one- dollar disaster preparedness charge is illegal in that the RIC does not have the power to raise taxes. VAT cannot be charged on this one dollar because it is not payment for services rendered. This is robbery or the arbitrary deprivation of my property without due process of law according to the Section of the 1976 Constitution dealing with fundamental rights.

I am on a fixed Government pension with no increase in sight. There are over 200,000 pensioners in this country and 300,000 people living below the poverty line.

That is how the poor will be pauperised further, PNM-style and exacerbate the ballooning poverty trap in the midst of plenty and prosperity for the chosen few.

Gov't must zero rate electricity, subsidise and supply gas directly to Powergen equal to Atlantic LNG, Ispat etc and de-monopolise top-heavy and inefficient T&TEC as the sole electricity provider similar to what is being done at TSTT. The gas supply contract between NGC and T&TEC must be terminated and a new replacement contract priced in TT dollars negotiated between Powergen/Trinity Power and the NGC with an appropriate Government subsidy to reduce generation costs.

No monopoly utility provider can ever or has ever delivered a consistently high quality of service at the lowest cost feasible without introducing competition into the industry. State monopolies are cash absorbers and low, sub-standard quality deliverers of utility services.

Although T&TEC is independent of Powergen and Trinity Power yet T&TEC supplies gas to these generation companies and receives power in the national grid. There are layers and layers of profiteering in the gas question. BPtt sells all the gas including that for the generation of electricity to the NGC. NGC sells to T&TEC and then T&TEC sells to the generation companies. The consumers have to pay for the unnecessary and avoidable profiteering realised by NGC and T&TEC in this arrangement. Twenty seven per cent of the expenditure of T&TEC is made up of gas supply and Powergen/ Trinity is paid a conversion premium for converting gas into electricity.

Even though T&TEC last received a rate increase in 1992 this is no basis to impose a 44% increase in one year on consumers when there is runaway inflation in food prices in the economy.

The RIC has made a proposal for T&TEC to establish a Low Income Assistance Programme budgeted at $5m to be contributed out of its revenues. How T&TEC will compile an equitable register of low income customers in need of assistance for the payment of their electricity bills remains to be seen.

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