NewsWhore
07-13-2011, 02:40 PM
The Dominican government has published its Letter of Intent to the board of directors of the International Monetary Fund where it makes known it will adjusting electricity rates "automatically" starting in September. According to the article in Nuevo Diario, the administration has sent a bill to Congress to legalize the automatic adjusting of the "technical tariff" of the electricity. The letter specifies they are going to allow the electricity companies to apply a 12% loss through distribution (technical losses) rather than the 40% losses that are typical in the Dominican Republic. According to the Letter of Intent, in the case of a significant increase in the price of oil before the law is approved, the electricity rates will be adjusted, passing the higher generation costs to the clients in order to avoid greater financial imbalance in the electricity sector and keeping the same electricity subsidy as included in the recent modification of the budget. While the approval by the IMF board of directors will mean the injection of hundreds of millions of dollars to the treasury, this commitment regarding the electricity rates (now at US$0.2902 kWh) will affect paying consumers. The Letter of Intent can be read here in Spanish: http://www.elnuevodiario.com.do/app/article.aspx?id=249313
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