By Jomo Paul
This was announced by Chairman of the Board of GPL Winston Brassington who told reporters at a press conference on Tuesday, February 10 that the decrease is “reasonable” and that GPL is able to afford it without any negative draw backs at this time.
Brassington said “we are doing this on a quarterly basis. So in July we will again review where fuel prices are and depending on that adjustments to what we are doing… So I want you to recognize that this fuel rebate is premised on the reduction of fuel prices.”
However, Brassington made it clear that while there may be increases, the electricity tariffs will not go beyond current rates which are set at $48 and $53 for residential consumers.
It was noted too that the 10% rebate is being applied to the energy charge and would not be reflected in the fixed charges.
The Chairman told reporters that as a result of this across the board increase, customers are expected to save some $3B annually.
Brassington said that while the possibility exists for GPL to reduce its tariff more than 10% it will not be doing so because several factors were considered when the number was arrived at.
He said that those factors included operational costs and foregone revenue that GPL has not collected over the years since it had taken no steps to increase the tariff although they were legally able to do so.
He contended that there is a “need to recognize where we have been and what we have doing…recognize that in the past we have foregone increases in tariff and we have substantially foregone revenue.”
It was explained that GPL over the years has foregone some $28B in revenue by not increasing its tariffs.
Given the fact that the price for fuel continues to be volatile on the international market and financiers are expecting fuels prices to go up, GPL explained that the “breakeven” point would be when fuel rises above US$70 per barrel.
