JPS seeking extraordinary light bill adjustment
Published:Wednesday | May 25, 2022 | 12:09 AM
To access this article in full please login or register today
Power provider Jamaica Public Service Company, JPS, wants an extraordinary rate review to recover two investments needed to offset future power cuts, according to documents submitted this month to the Office of Utilities Regulation, OUR, which...
Power provider Jamaica Public Service Company, JPS, wants an extraordinary rate review to recover two investments needed to offset future power cuts, according to documents submitted this month to the Office of Utilities Regulation, OUR, which regulates the electricity sector.
JPS wants an upward adjustment to its regulated revenue by roughly US$1 million to partially recover the cost of the so-called GT10 Hot Gas, or GT10 HGPI, and capacitor bank projects, to be undertaken in the Kingston and St Andrew corporate area. The combined projects are estimated at US$3.7 million.
The request, dated May 10, is additional to the JPS annual rate review that’s currently before the OUR.
The GT10 project, valued at US$2.4 million, will replace old equipment to prevent failure and load shedding, and is targeted at saving 20,000 megawatt hours of electricity annually.
“This recommendation comes against the background that thermal stresses, fatigue and corrosion during operation contribute to the overall degradation of hot gas path and combustion components over time,” JPS said.
The capacitor bank project costing US$1.3 million entails the installation of conductors to regulate the peaks and troughs in power supply at Greenwich Road, Hope Road, Rockfort, Washington Boulevard and Constant Spring Road.
“Further, in accordance with the above-mentioned GT10 HGPI and capacitor bank projects, JPS is requesting an adjustment of US$1.03 million to the revenue requirement for 2022, approved by the OUR in the final determination,” the power utility said in its Extraordinary Rate Review submission for 2022.
The adjustment would equate to around $160 million that JPS could recover from customers.
“Invariably, their ask, if accepted, will result in some upward movement in customer bills,” said Elizabeth Bennett Marsh, public education specialist at the OUR, in response to queries on the JPS extraordinary submission.
OUR later added in a press release that the extraordinary adjustment could add 10 basis points to expected 1.6 per cent average increase to light bills is expected from the regular annual tariff rate review.
With the extraordinary adjustment, the average increase would be about 1.7 per cent, the regulator said.
Customers can expect a determination by August.
The additional investment, JPS noted, became necessary following the decommissioning of old plants at Hunts Bay in Kingston two years earlier.
“Consequent upon the retirement of the Hunt’s Bay B6 Unit and the anticipated impact on load centres in the Corporate Area,” the utility said the projects would allow for “reactive support” and “maintaining grid stability”.
The projects were not originally budgeted for in JPS’s current five-year business plan. The US$3.7-million cost is additional to another US$10 million in core, unplanned maintenance costs associated with other projects mentioned by the utility.