THE National Utilities Regulatory Commission (NURC) Bill dominated most of the four-hour-long session of Parliament last Tuesday before it was eventually passed following some concerns by Opposition MPs.
Prime Minister Dr. Kenny Anthony said the bill seeks to create a commission that will regulate service providers in the utilities sector, such as the St. Lucia Electricity Services Ltd. (LUCELEC) and Water & Sewerage Company Inc. (WASCO).
Dr. Anthony said that despite LUCELEC’s “remarkable success” over the years, there have been several outstanding issues, including consumers’ complaints that the company’s rates are too high. Many people, the Prime Minister said, view LUCELEC’s rates as counter-productive, especially to business.
“When they look at the rates of returns, many feel that the rates are not competitive (and) do not favour investment, so they look elsewhere,” the Prime Minister told the House. “But they all concede unquestionably that (LUCELEC) is a highly-efficient company. But I suspect that the people who suffered the most are the ordinary consumers.”
The Prime Minister said that many consumers also felt helpless whenever they made a complaint to LUCELEC, that it was not responding to these complaints, adding that this might be due the lack of an independent body to (which) they could report their complaints.
While LUCELEC has expressed concerns about possible new entries into the local market, Dr. Anthony said the energy environment has changed drastically, positing that within the next 10 to 20 years “there’s going to be dramatic changes in the provision of electricity.”
“Already there are numerous experiments on the way in labs all over the world dealing with the energy sector,” Dr. Anthony stated. “Some have even indicated that the days of power lines will soon be over because electricity will be generated by individual units installed in people’s homes.”
But just how can LUCELEC adapt to these changes that threaten its current monopoly in the sector?
According to the Prime Minister, some changes are vital. One way of doing so, he said, is by reassuring consumers that they do have a say, particularly with respect to electricity rates, in being treated fairly. However, LUCELEC’s future as a viable company must not be eliminated from the equation.
“Equally, we must not engage in any behaviour that compromises future investment in LUCELEC. We have to find a model that allows LUCELEC to continue to innovate and to access new technology for the provision of electricity,” Dr. Anthony explained.
He added: “LUCELEC has to understand that it has a major role to encourage investment in this country and not discourage (it) and that Saint Lucia has to become competitive in the process.”
Under the present Electricity Supply Act, LUCELEC still has exclusive rights to supply power generated by fossil fuels. However, the Prime Minister said what the companion legislation seeks to do is to open the grid to suppliers of alternative energy for which LUCELEC does not have exclusivity.
Castries Central MP, Richard Frederick, expressed concerns, many of which were related to accountability and transparency of the Commission. For instance, the qualifications of the commissioners and the influence of the responsible minister, he said, left too much room for mischief.
Castries North MP, Stephenson King, welcomed the proposed legislation, saying it becomes necessary since “the ordinary citizen is losing confidence in those companies.”
“The time has come for consumers to have an avenue to make complaints and be satisfied that their complaints are being dealt with,” King said.
King also said that monopolies are taking a toll on consumers who are left with no choice but to complain.
“The issue of monopoly is (something) we see happening all over the country: in the private sector, in the utility sector,” King lamented. “When we look back over the past few years, we’ve seen that consumers do not have a choice in terms of consumer items.”
Meanwhile, LUCELEC’s Corporate Communications Manager, Roger Joseph, told The VOICE yesterday that LUCELEC has always supported regulatory reforms in the utilities sector. He said LUCELEC has participated in consultations on the bill in question albeit not in total agreement with all its aspects.
“There are aspects of the bill that we would have liked to see done differently,” Joseph said. “But fundamentally, we have no difficulty with the concept of an independent regulator for both LUCELEC and WASCO.”
While welcoming the proposed seven-member Commission to deal with matters concerning both utilities as cost-effective, Joseph said the Commission must serve its true purpose.
“As long as the Commission conducts its duties fairly and transparently,” Joseph said, “we do not have a problem with it.”
The bill now makes its way to the Senate.