electricity Archives - Page 10 of 18

Electricity Theft Could Mean Lights Out For JPS

May 10, 2013 jrobinson

TOMBLIN:

Arthur Hall, Senior News Editor

The Jamaica Public Service Company (JPS) is expressing concern that the long-running problem of electricity theft could cause its demise.

“For the JPS this might very well be the death knell … . There is no business in Jamaica that can lose $2 million to $3 million per month and still be viable, so for us it has reached a very critical point,” declared JPS President and CEO Kelly Tomblin yesterday during a media briefing.

Tomblin underscored that the JPS was at a financial precipice and could fall because it is in breach of a debt covenant which could trigger a demand for it to pay off US$425 million in debt.

According to Tomblin, the financial state of the company is worsened by electricity theft which triggered a penalty of US$30 million last year. That more than doubled the US$12.9 million which the JPS recorded as profit for the year.

“It is causing deteriorating financial performance that keeps me from doing many of the things that my team and I want to do to improve customer service,” Tomblin told journalists during a media briefing at the JPS’ New Kingston office.

“It is not just the theft, but it is also the penalty that we get because of the theft, so we are up against it and we don’t know how to combat,” added Tomblin.

Illegal connections removed

She said for the first three months of this year more than 54,000 illegal connections (throw-ups) were removed; 75 persons arrested and approximately 36,000 electricity audits conducted.

The JPS has also intensified the introduction of its Residential Automated Metering Infrastructure (RAMI) tamper-resistant metres with more than 22,000 persons connected at a cost of approximately $1,000 each. In addition, a special unit has been established to go after the commercial entities and other large users involved in electricity theft.

But Tomblin noted that these measures have not significantly reduced the level of electricity theft across the island.

“Estimates are that we still have 150,000 or up to 200,000 households stealing electricity and that’s against the backdrop of less than 600,000 customers … that could be a third of the people stealing so that is significant.”

Multifaceted approach

According to Tomblin, the problem of electricity theft has to be addressed in a multifaceted way because it is a socio-economic problem that cannot be addressed only by the JPS.

“We have a goal in the country that 100 per cent of Jamaicans should have access to electricity … but everybody cannot afford electricity, so what is the stop gap or the bridge? There is also the community acceptance of theft because we don’t see persons being arrested in droves.”

Tomblin argued that the root of the problem is crime and poverty and until these problems are addressed electricity theft will continue.

She charged that there needs to be tighter legislation with harsher penalties for electricity theft, even as she noted that the JPS does not benefit from the arrest of persons caught stealing electricity.

The JPS boss added that it needs the input of several different governmental and non-governmental organisations to come up with new measures to deal with the problem of electricity theft.

“We all have to get around the table and say let’s find a different solution because this one isn’t working.”

arthur.hall@gleanerjm.com

JPS News

Why employees in Ja’s largest corporations keep the nation’s energy bill high

May 10, 2013 jrobinson

There is so much talk and slow action about implementing alternative energy sources these days. Without a doubt, Jamaica will benefit from any decrease in cost for energy, but has anybody stopped to think of what will happen if we do not formulate firm strategies to manage consumption in all spheres of our daily life?

assess

As it exists now, our main supplier of electricity is unable to generate the amount of power to meet its demands, and whether our dreams of rates US 14 cents per kwh becomes a reality or not, we must think outside of the box in an effort to control consumption.

Office equipment, especially computers, are often left on after use in the office. (PHOTO: AP)

For the most part, energy saving activities are centred around the use of household appliances, lighting, and air condition units, which consume the most electricity. However, there is not as much enthusiasm expressed in the public domain as to how companies should effectively manage their power consumption.

It is believed that by now, organisations would have been proactive with fully developed programmes in engaging their team members in the importance of keeping their operational costs down by carefully managing the use of electricity.

However, as these organisations become more dependent on information technology to drive efficiencies in their operations, there is usually a correlative increase in power consumption. In many cases, this increase could actually be greatly curtailed, but on the other hand, IT mangers who orchestrate equipment usage are never usually concerned with cost containment.

Desktop and laptop computers usually account for the majority of technology equipment used in most companies, and this is where the haemorrhaging of electricity takes place, simply because these units are left on for long periods when not in use.

Individuals in most organisations cannot be relied upon to shut off their computers when not in use for long periods, particularly at the end of the day and Friday evenings.

The continuous waste of power inhibits the Jamaica Public Service Company to meet its demands for power in areas of the island which have never been privileged to have this modern convenience many of us take for granted.

Organisations that operate more than 50 or more computers are at serious risk of inflated JPS bills because of this type of oblivious behaviour. The associated costs of operation really add up when tabulated on a per annum basis.

Let us do some simple mathematics:

If your PC is on for left idle for 16 hours each week day after the usual eight hour work day and on weekends for a full 48 hours :

The total wasted hours per week is (16 x5) weekday + 48 weekend= 128 hours

Per Year this adds up to 128 x 52 (weeks) = 6656 hours

Each computer uses 128W = (6656 x 128)/1000 = 822kwh

Cost for Electricity Per KW/h in Jamaica is US$0.44

Total Cost for wasted electricity per computer per year is 882 X $0.44 = US$375

The kilowatt hours used in the computation does not include hours that computers may be idle during the work day.

This figure may not seem like a whole lot but consider those large corporations in Jamaica that have 500 to 1000 + employees. If 200 computers were to be left running for those hours per annum then that corporation will be looking at a whopping J$7,425,000 ($US375 x 200 x ROE J$99 = US$1) in payments to JPS.

These are not just costs that are impacting the private sector. This dilemma is every taxpayer across the nation’s problem. Our government employs more people than any private sector organisation and the waste in electricity throughout the various ministries is staggering.

The government owns approximately 80,000 computers. If just 20,000 are to be left on for 128 hours then the cost to taxpayers is over J$742.5 million. The current public sector bill for electricity is over J$1.2 billion per month which will grow as the government strives to modernise its operations.

Many companies have introduced energy conservation awareness programmes which are created to help their employees to better understand the impact of their action on the companies’ bottom line; however the benefits are usually short lived. The senior management in these large organisations must look at other ways they can manage these processes with a view to ensuring a more favourable outcome.

The implementation of software applications which do not require human intervention, which will shut down these computers when not in use is in fact available and organisations at risk should look at the available options coupled with its awareness programmes.

While cheaper sources of energy are still a far ways off, the issue of power generation by the JPS will always be a problem that will never go away if conservation is not tackled in a very serious way.

Dean Johnson is a specialist in information technology, sales and marketing. You can email him at energybugja@gmail.com.

Electricity JPS News

Energy News – JPS ripping us off again?

April 17, 2013 jrobinson

JPS ripping us off again?
April 17, 2013
Roger Chang

In the recent JPS Annual Tariff Adjustment Page 19 Technical Losses states:

“The T&D system configuration and voltage levels are critical to determining the actual
level of technical losses. Further reduction in technical losses will typically be as a
result of capital intensive programmes such as building more sub-stations or
“”increasing”” the voltage level at which we transmit and distribute electricity.”

Increasing the voltage WILL increase your electricity consumption and in effect your JPS
bill!

Most other countries practice something called “Conservation Voltage Reduction (CVR)” in
an attempt to save energy…. decrease voltage. (thanks Stanley)

The JPS nominal voltage should be 110vac or 220vac for rate 10 customers (residential)

I typically measure between 115vac to 125vac and many days close to 128vac, or 4.5% to
16.3% over nominal voltage.

Ever wonder why your motors and electrical equipment run hotter or burn up quicker?
Overvoltage?

Studies have shown 1% voltage change can yield a 0.6% change in consumption, or 2.7% to
9.8% increase in your JPS bill!

Is this there the 10% technical loss reduction will come from?
Technical losses is said to be about $1,500 million annually

Building a sub-station will cost money.
There is no cost to increase the voltage, but is an easy “hidden” way to extract more

money from every customer.

Where is the OUR?
Why is the OUR not regulating this?
Minister Paulwell?

more to come…

THE JAMAICA PUBLIC SERVICE CO. LTD. ANNUAL TARIFF ADJUSTMENT SUBMISSION FOR 2013
http://www.our.org.jm/images/stories/content/Electricity/Tariff/JPS%202013%20Annual%
20Tariff%20Submission.pdf

http://www.myjpsco.com/_pdfs/Interconnection_Technical_Guideline.pdf

http://www.jsea.org.jm/docs/DG%20Interconnection%20Guidelines%20-%20JPS%
20Co_July09_Draft%20v3.0_final.pdf

JPS News

JPS could face US$430-m payout for breach

April 15, 2013 Webmaster

THE viability of the Jamaica Public Service Company (JPS) has been questioned, with the light and power company in breach of loan covenants that could see creditors demanding immediate repayment of up to US$430 million ($42.4 billion).

It’s a financial situation that has led to JPS Chief Executive Kelly Tomlin volunteering to a 10 per cent pay cut, as the company works with lenders and shareholders on a short-term solution, and talks with the Office of Utilities Regulation (OUR) about new tariff guidelines.

TOMLIN… our goal is to electrify 100 per cent of Jamaica.

“Given the macroeconomics that we are facing and given the regulatory environment, our lenders are now saying that they don’t believe they can give us any further waivers,” Tomlin told the Jamaica Observer yesterday.

Auditors noted in JPS’s annual financial statements that the company has, since March 2012 — a month before Tomlin’s appointment — not been compliant with a condition included in long-term loan agreements with international development financial institutions, requiring the firm to maintain a 3:1 Debt to Earnings before Interest Tax Depreciation and Amortisation (EBITDA) ratio.

The violation provides the lenders with the option of issuing notices of default and declaring all principal and interest amounting to US$430 million, as at December 31, 2012, as immediately payable, stated the auditor’s notesaccompanying the power company’s 2012 financial results.

Should the respective lenders exercise their right to demand the repayment of this amount, it would cast significant doubt about the company’s ability to continue as a going concern, without the support of the shareholders or other third parties, the statement said.

Tomlin said yesterday that the company is in talks with creditors for an extension of the waivers while it works with the OUR and shareholders.

JPS in its annual tariff submission to the OUR blamed the breach on “significant under-recovery of fuel costs” experienced in 2011 and 2012, including more than US$30 million last year alone. Against this background, the firm said its “continued viability… will be dependent on a change to the regulatory approach in relation to the recovery of fuel costs.”

A quarter of the electricity that JPS transmits is lost to heat and theft, with the majority due to the latter. JPS contends that the challenge of substantially reducing leakages is socio-economic and largely outside of its control. In its submission to the OUR, JPS urged “regulatory acceptance of that fact” and called for a more holistic approach to combat electricity theft, including social intervention projects.

JPS is asking the OUR to allow the full pass-through of fuel costs on light bills as of the effective billing date of the Annual Adjustment Determination — July 1, 2013. The company said it is essential to ensuring the viability of the utility, given the context that in a typical year, its return on profit “is not likely to be more than two to three per cent of the total cost of electricity, against the background of what it deems as unfair penalties as they relate to the recovery of fuel costs.

The company noted that the losses penalty increases as sales shrink, given that the losses are calculated as a percentage of sales, and increases as the price of oil goes up. JPS reported a 63 per cent decline in annual net profit to US$12.9 million on flat sales last year.

The fuel penalty actually represented four per cent of the cost of fuel, thereby virtually eliminating all of the operating profit of the utility in 2012, the company said in its submission.

According to the light and power company, if approved, this measure would result in “a marginal increase in the average residential customer’s bill of less than 0.5 per cent or $16 per month”.

JPS suggests that customers stand to benefit substantially over the medium term, through a vibrant and viable JPS that can support generation expansion to significantly lower cost and invest in the network to improve service and reliability.

The successful implementation of a sustainable loss reduction programme, aimed at regularising 10,000 – 15,000 households per annum, will ultimately also result in a substantial reduction in the cost of electricity for all, said the company in its submission.

“The problem is everybody is willing to help if they see light at the end of the tunnel, but with this particular regulatory framework, there can be no light at the end of the tunnel because we seriously do not know how to stop crime, and that’s what we are being asked to do,” Tomlin said yesterday.

“We are giving power to everybody; that’s our goal, to electrify 100 per cent of Jamaica, but we all know 100 per cent of Jamaica cannot afford electricity,” she argued.

Meanwhile, Tomlin said that the company has independently executed a number of cost-cutting measures in the face of severe budget constraints.

“Customers don’t want us to reduce our capital budgets, or else you will experience more and more outages. But we have had redundancies and we are doing what we can,” Tomlin said, revealing that, in addition to her 10 per cent pay cut, other executives have volunteered to give up their vacation.

“We are asking everybody to give,” she said. “Unfortunately, our charitable contributions have also been severely slashed.”

Electricity JPS News

JPS promises lower April bills

April 12, 2013 Webmaster

THE Jamaica Public Service (JPS) says its customers will see a five per cent decrease in their electricity bill this month, despite the continued devaluation of the Jamaican currency.

This decrease, the light and power company said last night, is due to a reduction in the cost of the fuel used to generate electricity.

“Each month, the fuel charge on electricity bills changes, depending on the cost of the oil that JPS and other power-generating companies buy to produce electricity,” JPS said.

“The fuel & IPP cost on bills for April is $24.35 per kWh, compared to the charge of $26.54 per kWh applied to March bills.

“This means that a residential customer who consistently uses 200 kWh will be paying about $400 less for his/her bill this month, compared to what he paid last month. This customer will pay $7,518 for the 200 kWh of electricity used, as against the $7,918.55 that was paid in March for the same usage,” the company said.

The JPS, however, urged customers to continue their conservation efforts as the final bill amount will depend on total electricity used.

JPS News

5% reduction on April electricity bills JPS says

April 12, 2013 jrobinson

KINGSTON, Jamaica – Despite the continued devaluation of the Jamaican dollar, Jamaica Public Service (JPS) customers will see an average of five per cent reduction in their electricity bills for April, the power company says.

The decrease, JPS says, is due to a reduction in the cost of the fuel used to generate electricity.

JPS explained that each month the fuel charge on electricity bills changes, depending on the cost of the oil used to produce electricity. The Fuel & IPP Cost on bills for April is $24.35 per kWh, compared to the charge of $26.54 per kWh applied to March bills.

This means that residential customers who consistently use 200 kWh will be paying about $400 less for his bill this month, compared to what was paid last month, JPS said in a release Friday.

This customer will pay $7,518 for the 200 kWh of electricity used, as against the $7,918.55 that was paid in March for the same usage.

JPS News

5% reduction on April electricity bills JPS says

April 12, 2013 Webmaster

The decrease, JPS says, is due to a reduction in the cost of the fuel used to generate electricity.

This means that residential customers who consistently use 200 kWh will be paying about $400 less for his bill this month, compared to what was paid last month, JPS said in a release Friday.

This customer will pay $7,518 for the 200 kWh of electricity used, as against the $7,918.55 that was paid in March for the same usage.

Electricity Government JPS

Work to Begin on 360-Megawatt Capacity Plant This Year

April 8, 2013 jrobinson

Governor General, His Excellency the Most Hon. Sir Patrick Allen inspects the guard of honour before delivering the 2013/14 Throne Speech during the State Opening of Parliament held on Thursday, April 4, at Gordon House.

Governor General, His Excellency the Most Hon. Sir Patrick Allen, says the much anticipated construction of a 360-megawatt electricity capacity plant will commence this calendar year.

The Governor General, who was delivering the Throne Speech to mark the opening of the 2013/14 Parliamentary Year at Gordon House on Thursday morning, April 4, said the new facility will replace

JPS News

JPS to

March 22, 2013 jrobinson

JAMAICA Public Service Company (JPS) will next month begin to roll out retail stores that will sell energy-saving products.

The light and power company says the initiative will kick-start a more ’empowering’ engagement with its customers going forward.

Nicolette Hind shows off some of the eStore products during a promotion.

“It’s actually the first time we are venturing into anything like this. We always supported and encouraged; what we are doing now is investing in empowerment, so we are going further,” Winsome Callum, JPS’s head of corporate communications, told Caribbean Business Report during an exclusive interview at the firm’s Ruthven Road, Kingston, outlet on Wednesday.

The new retail stores, branded “eStore”, will be located inside existing JPS customer service offices, with the first store scheduled to be opened on April 4 at the Ruthven Road outlet.

JPS will initially offer up to 40 different energy-savings products, including a variety of power efficient gadgets, timers and sensors, said the company’s director of sales and marketing, Garth McKenzie.

“Our products will fall into three major categories: equipment that will save energy, equipment that will protect your investment and equipment that will help you to understand your usages,” said McKenzie, noting that the company is targeting both the residential and corporate markets.

JPS has partnered with a number of overseas and local suppliers, including Nicorp Limited and its brand of surge protectors.

While items will be on sale, the stores will primarily focus on teaching consumers about energy consumption and how to save, McKenzie said.

“We will be consumed with looking for those things that can help people to change their habits and improve their energy efficiency. Energy efficiency has to be more than just wishing it; it needs some education, tools and gadgets,” said the sales and marketing executive.

JPS, which has 15 offices islandwide, will officially launch up to four ‘eStores’ before the end of the year, but will be offering the new services at all the locations. The company did not disclose how much money was being invested in the venture.

“We will be dressing up about two or three more locations (after Ruthven Road) by the end of the year. For the other dozen or so that won’t be dressed up, we will be branding the space to let people know that there is an eStore operation there,” McKenzie said.

JPS, for years, has had an uneasy relationship with the Jamaican public, who have become increasingly frustrated with high electricity bills and accuse the company of being rapacious. The relationship hit a low point two years ago when a wide cross-section of Jamaicans, including a government senator and an Opposition member of parliament at the time, joined a social network campaign and wore black in protest against exorbitant electricity bills from the energy provider.

McKenzie said the ‘eStore’ initiative is aimed at improving the company’s relationship with customers.

“We recognise that the value that JPS is giving is not matching up with the cost and this is an attempt to improve that value proposition,” McKenzie said.

“What people are unhappy with is the apparent lack of control that they have over their electricity bills,” he continued. “We are a business so we expect to earn money, but more importantly we need to have customers that are more empowered so that they are less disgruntled.”

JPS announced earlier this week that customers will see a 10 per cent hike in their electricity bills this month, largely due to higher fuel costs and the depreciation of the Jamaica dollar.

Against this background, Callum noted that different macroeconomic factors have made it now even more critical for Jamaicans to focus on energy savings. JPS wants to help consumers realise this goal, she said.

“People say they have tried conservation and they don’t see the results, so we want to help them to actually see results,” Callum noted.

Government JPS LNG News

OUR reviewing electricity generation proposals

February 19, 2013 Webmaster

The Office of Utilities Regulation (OUR) last night opened a window of opportunity for firms wishing to submit proposals for a new electricity generating plant that would use liquefied natural gas (LNG) as its main fuel source.

According to the regulator, it will complete its review of the current proposal by the Jamaica Public Service (JPS) and other expressions of interest by the end of next month.

“Following the completion of this review, the OUR will formulate an opinion as to the feasibility of the offers and advise the Government whether it is worthwhile to proceed to finalise negotiations with any of these companies, including JPS,” the State agency said in a news release.

“This gives all entities which have expressed an interest, including JPS, a window of opportunity for a review of their proposals before the OUR returns to the market, if necessary,” the regulator said.

“The OUR will then await Government’s decision whether to sole source the project, which seems most feasible by way of readiness and also achieves the overall objective of reducing electricity prices in the shortest time. If such a project cannot be identified, then the OUR will go back to invite public tender,” it added.

The decision comes after the OUR, on February 1, informed the JPS and its shareholders that it had terminated the request for proposal (RFP) process in relation to the 360 MW project.

The OUR said it ended the process after JPS missed a third deadline on January 30 to complete the requirements under the RFP for the 360 MW project and had requested a 30-day extension.

But the JPS explained that the project scope changed significantly since 2011 when it was granted approval to proceed with construction of the plant.

“JPS’ role initially was simply to construct the plant, but late last year the company was asked to take on the additional responsibility of identifying a supplier and managing the process of procuring the LNG,” the light and power company’s President and CEO Kelly Tomblin said, adding that JPS has not participated in fuel procurement in the past.

Tomblin said that, despite her company’s best efforts, the market is not supporting earlier estimates of LNG prices as low as $8.50 mmbtu. “We have received indicative prices of upwards of $12.50 mmbtu for LNG and the related infrastructure, which we estimate would result in a reduction of approximately 20 per cent in electricity costs,” she explained.

Last night, the OUR said it has given JPS until Friday, March 15, to submit details of an alternative proposal for provisioning of electricity generation capacity.

“This was in response to a letter, containing a broad summary of its latest offer, sent on Thursday, January 31, 2013 by the JPS,” the OUR said, adding that it has advised the responsible minister of this process and he is in concurrence.

The OUR said that several other companies have expressed interest in providing electricity (generation capacity) since the termination of the RFP process.

“Those companies have also been given until March 15, 2013 to concretise their unsolicited submissions into firm proposals,” the regulator said.

“A meeting was held with JPS, following which the OUR informed the company that it would be allowed to submit the details of what is now considered an unsolicited proposal. The OUR will only entertain firm proposals in a state of readiness to be finalised with minimal negotiations. The proposals must be to provide electricity only and must be accompanied by the relevant fuel supply and other financing agreements,” the regulatory agency said.

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