JPS rate increase, win-win for company and clients - Leroy Reid
Leroy Reid, director of the Jamaica Public Service (JPS) south-west region, has suggested that the rate increase that was granted by the Office of Utilities Regulation (OUR) recently is a win-win for the company and its client base.
The bills of residential and small commercial customers will reflect a 0.5 per cent or a $67 hike as of this month, however, charges to large business operations are expected to decrease.
"We believe that partnerships are essential for the advancement of any nation, any industry, or any business," Reid said while speaking at the Montego Bay Chamber of Commerce and Industry's (MBCCI) Mobay Invest Breakfast Forum in the resort town, last weekend. "This is the guiding principle behind JPS' decision to invest US$116 million in 2018 to add new generation capacity and continue the modernisation of Jamaica's electrical infrastructure."
"JPS strategic objective is to balance the needs of the electrical system with the needs of our customers," continued Reid, whose south-west region consists of the eight parishes along the western and southern belts of the island. "One of the objectives of the rate determination is to allow customers to benefit from cost savings at JPS while allowing the company to continue investing in critical projects to modernise the energy sector and reduce bills over the long term."
According to the electricity firm, one of the objectives in applying for the review was to "manage rate impacts to customers and reduce the possibility of rate shocks from future rate reviews."
"This was achieved through the acceptance of our proposal to incorporate some plant depreciation costs in this rate review, rather than delay these costs for future reviews. This approach provides gradualism and helps prevent a balloon effect on rates," president and CEO, Emanuel DaRosa noted.
According to DaRosa, customers will benefit from several cost-saving initiatives incorporated in the annual rate review, including a plan to refinance long-term debt in order to reduce interest rates, which is expected to result in savings that will be passed on to customers.
The OUR has also been given JPS a partial reprieve from system losses penalty, to allow the company to invest in loss reduction initiatives that are expected to benefit customers, over time.