Small generators of renewable based electricity are being assured that they can still use the Jamaica Public Service Standard Offer Contract procedure to apply to sell electricity to the Jamaica Public Service (JPS).
This reassurance comes from the Office of Utilities Regulation (OUR), which published a notice two days ago, announcing the suspension of the non-competitive process for the generation of renewable based electricity.
OUR
Charlene Stuart, Senior Staff Reporter
Lobby group, Citizens United to Reduce the cost of Electricity (CURE), wants the Office of Utilities Regulation (OUR), to say why it is suspending the non-competitive process for the generation of renewable based electricity.
The electricity generated would be sold to the Jamaica Public Service Company (JPS).
The OUR made the announcement yesterday in a paid advertisement, indicating that the new measures take immediate effect.
The OUR has suspended the processing of non-competitive proposals for the generation of up to 25 megawatts of electricity from renewable energy sources.
The OUR said the suspension will remain until the completion of a competitive tender exercise to procure up to 115 mega Watts of power.
CURE
George Davis, guest columnist
The energy minister, Phillip Paulwell, has taken a lot of stick from members of the advocacy group, Citizens United to Reduce Electricity (CURE), for the turn of events regarding the all-island licence granted to the Jamaica Public Service Company (JPS) by the People’s National Party (PNP) administration in 2001.
The criticism, including the claim that the minister has betrayed the Jamaican consumer by supporting his Government‘s decision to appeal the ruling, is fully merited. The minister, whose popularity was in the early part of its growth phase at the time, effectively ‘called down crosses’ upon himself by hailing the July 30 Supreme Court ruling of Justice Bryan Sykes as a major decision in his own bid to bring competition to the energy sector.
The lawyer for CURE, Hugh Wildman, is on record saying Minister Paulwell told him privately that the court ruling will allow him and his Government to break up the JPS monopoly on the transmission and distribution of electricity.
With that admission, Paulwell effectively cut his own tamarind switch and asked CURE to flog him senseless after the reasons for the Government’s decision to join the JPS in appealing the ruling were articulated in the House of Representatives by Attorney General Patrick Atkinson on November 6.
Gathering storm
But the wrath at Paulwell’s impression of a ‘two-side cutlass’ is threatening to relegate the real issues, concerning the court ruling, to the sidelines. Principal among those real issues is the fact that in reality, the landmark victory secured by CURE in the Supreme Court would create an unprecedented crisis in every atom of the Jamaican society.
If, as the court found, the JPS’s all-island licence was indeed invalid, and the decision should be enforced, what would happen to the company’s operations? At what point would the JPS turn off the lights, send its employees home, and call time on its business interest in Jamaica?
What would Portia Simpson Miller, her Government and the citizenry do when JPS, with justification, demanded the return of the billions of dollars invested in its business, on the premise of being a monopoly, since 2001?
How would Government deal with the fact that it now has to foot a massive bill for a licence that it granted to the utility provider to meet the country’s energy needs?
For anyone in the dark about why the attorney general was moved to advise the Government to appeal the ruling, I ask only that you think very carefully on these things.
We should agree that shutting down the sole transmitter and distributor of electricity won’t translate into lower light bills for us, the hard-up and long-suffering JPS customers. If such a ruling were handed down against a company similar to the JPS today in, say, England, where Wildman found a 1913 court ruling to strengthen his arguments in the court, I could understand and accept.
No competition here
But England today, with its 42 counties, has more than 70 companies which supply customers with electricity or a combination of electricity and gas. Shutting down one of so many providers simply allows the customer to call in npower or a Sainsbury’s Energy to supply their electricity needs. That, unfortunately, is not the reality in Jamaica.
In all this, one must sympathise with the members of CURE. Theirs is, and continues to be, a gallant effort to do something about the crippling cost of our residential and commercial electricity bills. Hugh Wildman is a ‘square-shooting
George Davis, guest columnist
The energy minister, Phillip Paulwell, has taken a lot of stick from members of the advocacy group, Citizens United to Reduce Electricity (CURE), for the turn of events regarding the all-island licence granted to the Jamaica Public Service Company (JPS) by the People’s National Party (PNP) administration in 2001.
The criticism, including the claim that the minister has betrayed the Jamaican consumer by supporting his Government‘s decision to appeal the ruling, is fully merited. The minister, whose popularity was in the early part of its growth phase at the time, effectively ‘called down crosses’ upon himself by hailing the July 30 Supreme Court ruling of Justice Bryan Sykes as a major decision in his own bid to bring competition to the energy sector.
The lawyer for CURE, Hugh Wildman, is on record saying Minister Paulwell told him privately that the court ruling will allow him and his Government to break up the JPS monopoly on the transmission and distribution of electricity.
With that admission, Paulwell effectively cut his own tamarind switch and asked CURE to flog him senseless after the reasons for the Government’s decision to join the JPS in appealing the ruling were articulated in the House of Representatives by Attorney General Patrick Atkinson on November 6.
Gathering storm
But the wrath at Paulwell’s impression of a ‘two-side cutlass’ is threatening to relegate the real issues, concerning the court ruling, to the sidelines. Principal among those real issues is the fact that in reality, the landmark victory secured by CURE in the Supreme Court would create an unprecedented crisis in every atom of the Jamaican society.
If, as the court found, the JPS’s all-island licence was indeed invalid, and the decision should be enforced, what would happen to the company’s operations? At what point would the JPS turn off the lights, send its employees home, and call time on its business interest in Jamaica?
What would Portia Simpson Miller, her Government and the citizenry do when JPS, with justification, demanded the return of the billions of dollars invested in its business, on the premise of being a monopoly, since 2001?
How would Government deal with the fact that it now has to foot a massive bill for a licence that it granted to the utility provider to meet the country’s energy needs?
For anyone in the dark about why the attorney general was moved to advise the Government to appeal the ruling, I ask only that you think very carefully on these things.
We should agree that shutting down the sole transmitter and distributor of electricity won’t translate into lower light bills for us, the hard-up and long-suffering JPS customers. If such a ruling were handed down against a company similar to the JPS today in, say, England, where Wildman found a 1913 court ruling to strengthen his arguments in the court, I could understand and accept.
No competition here
But England today, with its 42 counties, has more than 70 companies which supply customers with electricity or a combination of electricity and gas. Shutting down one of so many providers simply allows the customer to call in npower or a Sainsbury’s Energy to supply their electricity needs. That, unfortunately, is not the reality in Jamaica.
In all this, one must sympathise with the members of CURE. Theirs is, and continues to be, a gallant effort to do something about the crippling cost of our residential and commercial electricity bills. Hugh Wildman is a ‘square-shooting
HEART TO HEART
With Betty Ann Blaine
Tuesday, September 18, 2012
Dear Reader,
There is a monopoly mindset that seems to have taken deep root in the psyche of certain individuals and organisations in Jamaica, but perhaps more detrimentally inside the corridors of government.
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DAVIS… a properly regulated monopoly is perhaps the best option for Jamaica |
That monopoly mindset reared its head a few weeks ago when the senior adviser to the prime minister, Dr Carlton Davis, was quoted as saying that a properly regulated monopoly was perhaps the best option for Jamaica – the statement made within the context of the monopoly licence currently held by the light and power company, the Jamaica Public Service Company.
Dr Davis’s statement sent shock waves across the country for more reasons than one. First, it breached acceptable protocols in that it usurped the portfolio of the Minister of Energy Phillip Paulwell, who should have been the person to speak on such matters. Second, Dr Davis’s comment was diametrically opposed to the stated public position of the minister of energy who has been heralding the cause of competition and bemoaning the untenable nature of the current monopoly arrangement with the JPS. Third, Dr Davis’s position as head of the LNG (Liquified Natural Gas) Steering Committee represents a de facto conflict of interest inasmuch as it reflects the very same position of the monopoly provider with a potential interest in the LNG market.
I believe that the question must be asked: “Whose side is Dr Davis on?” In addition, as he is senior adviser to the prime minister, are we to deduce that any advice to Mrs Simpson Miller regarding the JPS would favour the retention of that company’s monopoly status?
My question to Dr Davis is, “Monopoly best” for whom? The senior adviser should be asked to delineate how the JPS monopoly has been “best” for Jamaican consumers.
The litany of complaints against the JPS is as extensive as it is long-standing. From overbilling, back billing, connections, disconnections and reconnections, Jamaican consumers have continually expressed their disgruntlement with the costs and services offered by the light and power company.
In fact, the formation of the consumer advocacy group, CURE (Citizens United to Reduce Electricity), was as a direct response to the insatiable menu of complaints against the JPS, particularly the cries that went up about the new digital meters that have been introduced for the first time in Jamaica.
And householders were not the only complainers. One of the sectors affected most severely by the high cost of electricity is the country’s small and medium-sized businesses. Many have already collapsed and some of those remaining are teetering on the brink of insolvency.
Separate and apart from Jamaica’s particular and precarious energy situation, the notion of perpetuating monopolies is fast becoming a thing of the past, but there are those amongst us who simply don’t get it.
By definition, a monopoly is a market with only one seller – where a business is the only provider of certain goods or services. Anyone who has ever played the popular game, Monopoly, would have a pretty good idea of what a monopoly is. In the board game, one of the goals is to own all of the properties of a particular colour, or in economic terms, to have a monopoly on properties of a particular colour. It is also the case that when a player has a monopoly on a set of properties, the rents on those properties go up. This is also a realistic feature of the game since it’s generally true that monopolies lead to higher prices.
The general agreement is that monopolies are bad for consumers. Under a monopoly, the producer is assured of his profits and his inducement to introduce innovations is unlikely. He is not under any competitive urge to introduce changes or increase output. According to one economist, “The monopolist functions from a position of privilege. He works from behind a protective shell. If capitalism stands for constant changes which provide vitality to the capitalist system, monopoly cannot sustain it.”
In 1997, New Yorkers, faced with mounting increases in their electricity bills, moved to dismantle the monopoly held by the light and power company, Con Edison. The plan split Con Edison into three companies. “One will own power plants and compete on the wholesale level with other generators. A second will be a power retailer, buying power from wholesalers and competing with other retailers for customers’ business. The third will maintain monopoly ownership of the wires that link customers to the state’s power grid and will charge competing retailers for the use of the “network”. Although it was not a perfect plan, one official described it as “a floor we can build on”. Consumers in New York experienced an immediate 10 per cent cut in electricity rates as a result of the dismantling of the monopoly.
Here at home, dismantling the monopoly mindset appears to be a critical pre-requisite, but one that appears to be inevitable.
With love,
bab2609@yahoo.com
Read more:
Barbara Gayle, Justice Coordinator
The attorney representing claimants in the class action suit against the Jamaica Public Service Company (JPS) is to head to the Court of Appeal today to file a counter notice of appeal.
This follows the filing by JPS yesterday of an appeal of the judges
The government has announced that energy Minister Phillip Paulwell will shortly be making a statement on his discussions with the Jamaica Public Service Company Limited (JPS).
The talks with the JPS became critical after the Supreme Court ruled recently that the licence granting the company a monopoly on the transmission and distribution of electricity was not valid.
Yesterday, the Office of the Prime Minister dismissed concern that there was a conflict within the government regarding the liberalisation of the energy sector.
Questions were raised after the head of the liquefied natural gas steering committee, Dr Carlton Davis, told a
CURE REJECTS
The Jamaica Public Service Company, JPS, is to challenge yesterday’s Supreme Court ruling regarding the exclusivity of
Citizens United to Reduce Electricity (CURE) is celebrating the landmark decision handed down in the Jamaica Supreme Court today in which the monopoly license of the Jamaica Public Service Company (JPS) was declared invalid and illegal.
The ruling comes almost one year after CURE initiated a class action suit challenging the JPS
