Public Utilities Minister Marvin Gonzales

Public Utilities Minister Marvin Gonzales says the Trinidad and Tobago Electricity Commission (T&TEC) and the Water and Sewerage Authority (WASA) are finally set to submit their operational plans and he expects they will be approved by the Cabinet by the end of the year.

While the Regulated Industries Commission (RIC) needs the approved plans to kickstart the rate review process, Gonzales has assured that the most vulnerable will be protected once the new rates take effect.

“There are a lot of people living in upscale communities across Trinidad and Tobago with large swimming pools, enjoying subsidised rates for water and electricity. Do they need it?” Gonzales asked yesterday.

He said these are the households being targeted under the utility rates review.

“They don’t need it because they have the capacity to pay for the water they are consuming in their swimming pools,” Gonzales stated.

The Public Utilities Minister confirmed to Guardian Media that T&TEC has completed its business plan, having finally negotiated its purchasing price for gas from the National Gas Company.

In June, T&TEC’s general manager, Kelvin Ramsook, had told a parliamentary committee that if the entire subsidy is removed from the price the company pays for gas, then customers could pay as much as US nine cents per kilowatt hour, up from US four cents.

The last rate review was done in 1993.

Yesterday, Gonzales said, “The RIC has started to do a lot of work. They have started to do the necessary publications in the media for a rate review for both WASA and T&TEC.”

He noted that due to the current restructuring at WASA, the company is unable to put forward a business plan and as such, the RIC has agreed to accept a Cost of Service plan from the authority.

“Unfortunately, WASA has not been able to produce audited financial statements for the last four or five years and that is integral towards completing the business plan. Are we going to wait for WASA to complete its audited financial statements in order to complete its business plan? But, of course, that cannot be done,” he said.

He added, “The Board of Commissioners have already made significant progress in completing that Cost of Service plan and once that is done, they will provide whatever other documents that are required by the RIC so that they can move forward with the rate review process.”

Once these plans are approved by the Cabinet, they will be forwarded to the RIC for its consideration of new rates. The proposed rates will then be sent back to Cabinet for its approval. It is at this stage, Minister Gonzales explained, that the Cabinet will decide on a subsidy structure to protect vulnerable households.

“There are a lot of people who can afford to pay the market rate for electricity, water and gas and those citizens must be allowed to do that,” he noted.

During his Budget presentation on Monday, Finance Minister, Colm Imbert announced an increase in the rebate for utility bills of $300 or under from 25 per cent to 35 per cent. This comes into effect from January 1, 2022. Currently, approximately 220,000 customers benefit from rebates.

“And it costs the Government about $30 million annually and what T&TEC does is that it makes the necessary deductions from the bills of the customers and then the Government, via allocations to the Ministry of Public Utilities, will pay T&TEC for the shortfall,” the Minister explained.

And while citizens may be spending more money to turn on your lights and taps, Minister Gonzales assured that you will be paying for a better quality of service.

“I could tell you as Minister of Public Utilities, I will not sit by and allow a rate review to take place if there isn’t a concomitant effort to improve the standard of service at both T&TEC and WASA,” he affirmed.

He indicated that part of the RIC’s mandate is to monitor the performances of utility companies and ensure customers get value for money.

However, economist Dr Terrence Farrell does not believe increasing the rebate rates is a good idea.

“The question about giving people rebates for electricity consumption is good politics but bad economics,” Dr Farrell said during a post-Budget panel discussion hosted by the Trinidad & Tobago Chamber of Industry and Commerce yesterday.

Chief Executive Officer of the American Chamber of Commerce, Nirad Tewarie, also cautioned against keeping vulnerable citizens in a dependency loop.

“Because if you need to be paying people’s electricity and water bills for them, it means they are in a difficult position generally. We need to get them out of that position and then into the position where they have opportunities,” Tewarie stated.