Government to absorb half of electricity fuel surcharge increase

Consumers of electricity can expect to see yet another increase on their bills this month due to a 14-cent increase in the fuel surcharge.

But half of that will be absorbed by the government as it strives to keep energy costs as low as possible.

Prime Minister, Dr Ralph Gonsalves made this announcement on radio on Monday, June 13 following an emergency meeting with the Director General of Finance and Planning, Edmond Jackson; chairman of VINLEC’s Board, Rene Baptiste and acting VINLEC CEO, Dr Vaughn Lewis.

Yesterday’s emergency meeting follows discussions over the weekend, including one with Baptiste, who indicated to Gonsalves on Saturday that because of the increasing prices on diesel, the fuel surcharge had jumped from about 58 cents per unit to 72.5 cents per unit — a 14-cent increase.

“The highest that it has ever been is in 2008 when it was 67 cents, approximately, per unit, per kilowatt hour. Remember in that year, in June/July, the price rose for…unrefined diesel, the crude oil, to $147.50 a barrel. Now this would’ve taken it higher,” Gonsalves said during a call to the Shake Up programme on WEFM.

The prime minister said on Sunday he had discussions with VINLEC’s CEO, Thornley Myers and finance minister, Camillo Gonsalves — both of whom are in Canada and the Turks and Caicos Islands respectively after which it was decided that the 14-cent increase on the fuel surcharge would be split between the government and the consumer.

This means that consumers will bear only seven cents of the increased fuel surcharge.

Therefore if a consumer’s bill were to increase by $20 more due to the 14-cent increase, they will only be made to pay $10 and the other half will be absorbed by the government.
“We’ll keep it below what the

highest point has ever been but still it will increase. VINLEC will absorb about $500,000 worth of that and the government would put a number close to about $300,000…” Gonsalves said.

The prime minister explained that if the government were to absorb all of the cost, it will amount to approximately $1.6 million.

“It’s a difficult period and as always, I have to come to the people and be very honest…I want the public to know that it’s the best we can do in the circumstances. We split it 50/50,” he said.