Wed | Dec 7, 2016

The senseless complexity of the net billing bureaucracy

Published:Friday | September 12, 2014 | 12:00 AM

IT IS amazing how a person's mindset affects his or her behaviour.

It is similarly astounding how much our country's, and certainly the mindset of its policymakers and bureaucrats, affects the quality of behaviour and services handed out to Jamaicans.

The operating approach of a few generations of our political leaders, policymakers and many bureaucrats seem to be, if the process can be simple - make it difficult.

The renewable energy net billing arrangement between Jamaica Public Service Company (JPS) and its residential and corporate clients is a case in point. Under the current legal arrangement, individual JPS clients can install renewable-energy systems at their houses, usually solar or wind, to produce up to 10kW of power, while commercial establishments can install up to 100kW for their use. That is simple.

Then we get into the quite senseless complexity. By law, the minister of energy has to sign the licence to allow the process of approval to start. Believe it or not, the minister has to sign a licence to generate the small amount of up to 10kW of power at a single Jamaican home! Does he not have anything better to do with his time?

One could easily envision how the minister becomes a part of a bottleneck system in the approval process when there are many approval requests.

The JPS is called on to do a technical assessment of the application. Their recommendation then goes to the Office of Utilities Regulation (OUR) which holds it a couple of days, adds little or no value, and sends it on to the minister, who adds no value but may delay it for a while before adding the ministerial rubberised chop.

Once the licence is approved, the JPS prepares a standard offer contract - an SOC - for the client-applicant, who then must pay a number of fees and secure an approval from the Government Electrical Inspectorate (GEI), which generally takes about three weeks.

CUSTOMER-INVESTOR SUFFERING

My experience of the suffering of a customer-investor comes from two sources. As a JPS client, I recently installed complete solar panels and solar water heater systems to cover the electricity and hot water needs of my home.

As the non-executive chairman of IREE Solar, I am informed from time to time of the travails and some of the complaints of IREE Solar's and JPS's joint clients.

Recently, two of the joint clients have been bearing down on our company for the extensive delays they have experienced in getting their systems commissioned by the JPS.

They complain, rightly, that they have completed all the paperwork and paid all the required fees months ago and they cannot get their bidirectional meters installed by the JPS to get credit for the energy their solar systems produce.

This means, in their view, that the investment they have made in solar energy produces zero benefit. Worse, in one case, JPS sent an estimated bill that was higher than the ones before the solar system was installed, and despite the fact that the home was unused for the period of the estimate because the occupants were on vacation.

We escalated our contacts at JPS to the highest level and the utility company was very responsive. They are addressing the unrealistic estimate issue and have taken steps to speed up the approvals for these two clients of our company.

GOJ IS THE PROBLEM

The law to have the minister sign off on all power generating applications in the country was no doubt designed for big power-production installations - not for 10kW solar and wind systems.

Indeed, it is quite likely such small systems and renewable technology were not considered when the ministerial chop was put in the law.

The solution to this net billing irritation and useless conundrum is simple, but - given the prevailing and awesomely pervasive mindset of our policymakers - not easy. For those JPS clients who install the 10kW and 100kW systems, JPS should be able to do the same assessment and issue the licence to these individual and commercial clients.

Given that JPS could drag approval and its implementation feet in the process, the only regulation - or law, if required - would be to require the utility giant to issue the licence within two days after it gets a completed application, and the bi-directional meter in, say, two working days after the GEI grants its approval.

The other regulation required is that which would oblige the GEI to grant its approval in five working days after the customer pays the $25,000 fee for the GEI inspection service.

While the focus of this column is on small renewable-energy installations, the president and CEO of JPS, Kelly Tomblin, complained publicly two months ago about the 15 days the GEI takes for small installations and the whopping 96 days for larger commercial businesses to approve new power supply.

There are some aspects of the SOC that need cleaning up, as well as better clarity and specificity, and these have been pointed out to senior executives. We watch for the changes soon.

The OUR will tell you it does not make energy policy; it simply follows those promulgated by our Government.

There is no need for a minister of energy to sign a licence for a 10kW system at a private home. Government, please simplify the regulations or laws and take yourself out of the way and process.

Aubyn Hill is CEO of Corporate Strategies Limited and chairman of Opposition Leader's Economic Advisory Council.Email: writerhill@gmail.comTwitter: @HillaubynFacebook: facebook.com/Corporate.Strategies