NewsWhore
07-19-2010, 06:00 PM
Writing in Hoy, electrical engineer Bernardo Castellanos questions the wisdom of the government once again wants to raise power rates on the grounds that neither the present electricity tariffs nor the government subsidy cover the costs of power distribution.
He comments that the IDB representative in the country, Manuel Labrado himself has stated that no matter how much money a business may derive, the problem is not solved if there is not adequate management of billing and collecting for the service.
Castellanos says Labrado has put it clearly. The problem is in the inefficiency and bad administration of the power distributors.
He called for the government to come up with a better strategy to justify the intention to raise rates again rather than using words such as "flexibilization" or "rebalancing" of electricity tariffs to camouflage the increases.
He said that the Public Electricity Corporation (CDEEE) stats in its Reports on Performance of the Electricity Sector indicate that the average intermediation of the distributors or the value added of distribution (VAD) is at US$0.06/Kwh. He says this is evidence that on average the companies have been billing much more than what it costs them to purchase the power from the generators.
Castellanos believes that the government has better options. He states: "Before talking about flexibilizing or rebalancing rates, economic rationality needs to be imposed on the current expenditures of the government-owned electricity companies. He says that their monthly payrolls have increased on average US$156 million a year since August 2004. He believes that savings can also be made by reducing the 40% difference in energy billed and collected in areas where the PRA program is in effect and those without it. Also, he says rates should not be increased while the CDEEE continues to violate the General Electricity Law, especially its Art 110 that establishes that 80% is the maximum potency the distributors should contract with the generators, compared to 90% at present.
Castellanos writes that the "rebalancing" of rates would only serve to place an even greater burden on consumers who already pay for an expensive and very poor service, while maintaining the inefficiency and bad administration at the power distributors, the excessive spending on payrolls in the government-owned electricity companies.
He mentions that as of June 2010, the CDEEE had 15 advisors (RD$2.6 million a month), in addition to a payroll of 821 employees (RD$32.25 million a month) plus 168 military staff (RD$701,000 a month). "Does the CDEEE need so many staff and advisors to do their job efficiently?"
www.hoy.com.do/opiniones/2010/7/17/334382/Rebalanceo-de-la-tarifa-electrica (http://www.hoy.com.do/opiniones/2010/7/17/334382/Rebalanceo-de-la-tarifa-electrica)
More... (http://www.dr1.com/index.html#4)
He comments that the IDB representative in the country, Manuel Labrado himself has stated that no matter how much money a business may derive, the problem is not solved if there is not adequate management of billing and collecting for the service.
Castellanos says Labrado has put it clearly. The problem is in the inefficiency and bad administration of the power distributors.
He called for the government to come up with a better strategy to justify the intention to raise rates again rather than using words such as "flexibilization" or "rebalancing" of electricity tariffs to camouflage the increases.
He said that the Public Electricity Corporation (CDEEE) stats in its Reports on Performance of the Electricity Sector indicate that the average intermediation of the distributors or the value added of distribution (VAD) is at US$0.06/Kwh. He says this is evidence that on average the companies have been billing much more than what it costs them to purchase the power from the generators.
Castellanos believes that the government has better options. He states: "Before talking about flexibilizing or rebalancing rates, economic rationality needs to be imposed on the current expenditures of the government-owned electricity companies. He says that their monthly payrolls have increased on average US$156 million a year since August 2004. He believes that savings can also be made by reducing the 40% difference in energy billed and collected in areas where the PRA program is in effect and those without it. Also, he says rates should not be increased while the CDEEE continues to violate the General Electricity Law, especially its Art 110 that establishes that 80% is the maximum potency the distributors should contract with the generators, compared to 90% at present.
Castellanos writes that the "rebalancing" of rates would only serve to place an even greater burden on consumers who already pay for an expensive and very poor service, while maintaining the inefficiency and bad administration at the power distributors, the excessive spending on payrolls in the government-owned electricity companies.
He mentions that as of June 2010, the CDEEE had 15 advisors (RD$2.6 million a month), in addition to a payroll of 821 employees (RD$32.25 million a month) plus 168 military staff (RD$701,000 a month). "Does the CDEEE need so many staff and advisors to do their job efficiently?"
www.hoy.com.do/opiniones/2010/7/17/334382/Rebalanceo-de-la-tarifa-electrica (http://www.hoy.com.do/opiniones/2010/7/17/334382/Rebalanceo-de-la-tarifa-electrica)
More... (http://www.dr1.com/index.html#4)