Yahneake Sterling, Staff ReporterCONSUMERS COULD face an increase in light bills if the Jamaica Public Service Company (JPS) is allowed to recover almost $200 million from losses it said it suffered during last year's hurricanes.
The light and power company has submitted a claim to the Office of Utilities Regulation (OUR) for $191.8 million for losses incurred during the passage of hurricanes Emily, Dennis and Wilma.
The JPS is allowed to file claims, six months before a review starts on June 1 each year, through the All Island Electric Licence of 2001.
In the claim, submitted on April 2, the JPS said the hurricanes had numerous effects on the company's financial status.
"JPS also experienced reduced levels of energy sales during the months of July and October 2005," stated the light and power company in its annual tariff adjustment submission for 2006. "This reduction in energy sales has resulted in a fundamental inability to recover fixed embedded costs, which forms part of the company's revenue requirement."
CLAIM FOR DAMAGE TO PROPERTY
The document stated that $86.8 million of the JPS's claim is for damage to company property during the hurricanes and $73.3 million for loss of revenue.
David Geddes, OUR director of consumer and pubic affairs, noted that the transmission and distribution lines used by the power company cannot be insured so the company has to protect its revenue.
"Our technical team will be reviewing the document to determine what claims are legitimate and what claims are not allowed," Mr. Geddes said.
The JPS has proposed that the OUR allow the company to recover its losses from the sinking fund, a self-insurance fund formed by the company in 2004.
Additionally, the power company suggested that recovery be allowed through non-fuel based rates.
The JPS is also asking for the OUR to move its base exchange rate to J$65 to US$1. The base rate currently stands at J$62.
Just last year, the JPS submitted a claim of $1.5 billion for damage incurred during the passage of Hurricane Ivan. The OUR however approved only a third of the claim.
