BWS Objects to PUC Decision on Water Rates

BWS PicDirector of Water Services for the Public Utilities Commission (PUC), Rudolph Williams, confirmed to PLUS News this afternoon that the PUC’s initial decision on the Annual Review Proceeding (ARP) for Belize Water Services Limited (BWS) has not been finalized as the water provider has objected.

On January 30, 2014, the PUC approved a 6.4% increase in water rates for all of Belize except for Caye Caulker to take effect following the standard period for comments by concerned parties. BWS had asked for a 16% increase citing an increase in capital investments of $25 million, later reduced to $14 million.

According to Williams the basis of the objection is a dispute over the PUC’s treatment of contributed capital, that is, funds provided by the Government of Belize which owns a majority of the company for supporting capital investments and from individual developers like those who ask for extended connections at their home.

The capital for the 2013-14 period is $7.3 million, up from $6.9 million last year but to be reduced to $4.5 million next year. The Government submitted in writing that its position is to forego recollection of these funds and so, said Williams, they were subtracted from the regulated asset value (RAV), which currently stands at some $120 million, an increase of Public Utilitites Commission logo$4 million over the last financial year. The RAV was recalculated going back to 2008 and reduced every year from then. With a reduced rate of return of 8% applied, Williams argues, BWS’ asked-for increase was too much.

As the company disagrees, the PUC will now appoint an independent expert.  There is a 15 day period for this and the appointed expert has 30 days to investigate and assess BWS’ claims, after which the PUC has a further 15 days to review before a final decision is issued.

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